Correlation Between Walker Dunlop and Fortum Oyj
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Fortum Oyj 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 Fortum Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Fortum Oyj ADR, you can compare the effects of market volatilities on Walker Dunlop and Fortum Oyj 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 Fortum Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Fortum Oyj.
Diversification Opportunities for Walker Dunlop and Fortum Oyj
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Walker and Fortum is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Fortum Oyj ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortum Oyj ADR 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 Fortum Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortum Oyj ADR has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Fortum Oyj go up and down completely randomly.
Pair Corralation between Walker Dunlop and Fortum Oyj
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.64 times more return on investment than Fortum Oyj. However, Walker Dunlop is 1.57 times less risky than Fortum Oyj. It trades about 0.08 of its potential returns per unit of risk. Fortum Oyj ADR is currently generating about -0.05 per unit of risk. If you would invest 10,473 in Walker Dunlop on August 28, 2024 and sell it today you would earn a total of 776.00 from holding Walker Dunlop or generate 7.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. Fortum Oyj ADR
Performance |
| Timeline |
| Walker Dunlop |
| Fortum Oyj ADR |
Walker Dunlop and Fortum Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Fortum Oyj
The main advantage of trading using opposite Walker Dunlop and Fortum Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Fortum Oyj 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 Fortum Oyj will offset losses from the drop in Fortum Oyj'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 |
| Fortum Oyj vs. Constellation Energy Corp | Fortum Oyj vs. Astra Energy | Fortum Oyj vs. Powertap Hydrogen Capital | Fortum Oyj vs. Brenmiller Energy Ltd |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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