Correlation Between Walker Dunlop and IShares ESG
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and IShares ESG 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 IShares ESG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and iShares ESG Advanced, you can compare the effects of market volatilities on Walker Dunlop and IShares ESG 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 IShares ESG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and IShares ESG.
Diversification Opportunities for Walker Dunlop and IShares ESG
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Walker and IShares is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and iShares ESG Advanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares ESG Advanced 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 IShares ESG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares ESG Advanced has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and IShares ESG go up and down completely randomly.
Pair Corralation between Walker Dunlop and IShares ESG
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.87 times more return on investment than IShares ESG. However, Walker Dunlop is 1.87 times more volatile than iShares ESG Advanced. It trades about 0.05 of its potential returns per unit of risk. iShares ESG Advanced is currently generating about 0.06 per unit of risk. If you would invest 9,359 in Walker Dunlop on August 27, 2024 and sell it today you would earn a total of 1,490 from holding Walker Dunlop or generate 15.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. iShares ESG Advanced
Performance |
| Timeline |
| Walker Dunlop |
| iShares ESG Advanced |
Walker Dunlop and IShares ESG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and IShares ESG
The main advantage of trading using opposite Walker Dunlop and IShares ESG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, IShares ESG 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 IShares ESG will offset losses from the drop in IShares ESG'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 |
| IShares ESG vs. iShares ESG Advanced | IShares ESG vs. iShares ESG Advanced | IShares ESG vs. iShares ESG MSCI | IShares ESG vs. iShares ESG Advanced |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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