Correlation Between Walker Dunlop and DLH Holdings
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and DLH Holdings 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 DLH Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and DLH Holdings Corp, you can compare the effects of market volatilities on Walker Dunlop and DLH Holdings 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 DLH Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and DLH Holdings.
Diversification Opportunities for Walker Dunlop and DLH Holdings
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Walker and DLH is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and DLH Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DLH Holdings Corp 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 DLH Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DLH Holdings Corp has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and DLH Holdings go up and down completely randomly.
Pair Corralation between Walker Dunlop and DLH Holdings
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.83 times more return on investment than DLH Holdings. However, Walker Dunlop is 1.2 times less risky than DLH Holdings. It trades about 0.06 of its potential returns per unit of risk. DLH Holdings Corp is currently generating about -0.01 per unit of risk. If you would invest 7,549 in Walker Dunlop on August 31, 2024 and sell it today you would earn a total of 3,469 from holding Walker Dunlop or generate 45.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. DLH Holdings Corp
Performance |
| Timeline |
| Walker Dunlop |
| DLH Holdings Corp |
Walker Dunlop and DLH Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and DLH Holdings
The main advantage of trading using opposite Walker Dunlop and DLH Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, DLH Holdings 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 DLH Holdings will offset losses from the drop in DLH Holdings' 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 |
| DLH Holdings vs. Network 1 Technologies | DLH Holdings vs. Wilhelmina | DLH Holdings vs. Mader Group Limited | DLH Holdings vs. First Advantage Corp |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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