Correlation Between Walker Dunlop and SPDR Global
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and SPDR Global at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Walker Dunlop and SPDR Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and SPDR Global Dow, you can compare the effects of market volatilities on Walker Dunlop and SPDR Global and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Walker Dunlop with a short position of SPDR Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and SPDR Global.
Diversification Opportunities for Walker Dunlop and SPDR Global
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Walker and SPDR is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and SPDR Global Dow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Global Dow and Walker Dunlop is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Walker Dunlop are associated (or correlated) with SPDR Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Global Dow has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and SPDR Global go up and down completely randomly.
Pair Corralation between Walker Dunlop and SPDR Global
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the SPDR Global. In addition to that, Walker Dunlop is 2.18 times more volatile than SPDR Global Dow. It trades about -0.09 of its total potential returns per unit of risk. SPDR Global Dow is currently generating about 0.08 per unit of volatility. If you would invest 13,544 in SPDR Global Dow on August 26, 2024 and sell it today you would earn a total of 149.00 from holding SPDR Global Dow or generate 1.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. SPDR Global Dow
Performance |
| Timeline |
| Walker Dunlop |
| SPDR Global Dow |
Walker Dunlop and SPDR Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and SPDR Global
The main advantage of trading using opposite Walker Dunlop and SPDR Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, SPDR Global can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in SPDR Global will offset losses from the drop in SPDR Global's long position.| Walker Dunlop vs. Mr Cooper Group | Walker Dunlop vs. Velocity Financial Llc | Walker Dunlop vs. Security National Financial | Walker Dunlop vs. Encore Capital Group |
| SPDR Global vs. Simplify Interest Rate | SPDR Global vs. WisdomTree Global High | SPDR Global vs. JP Morgan Exchange Traded |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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