Correlation Between Walker Dunlop and Merrill Lynch
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Merrill Lynch 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 Merrill Lynch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Merrill Lynch, you can compare the effects of market volatilities on Walker Dunlop and Merrill Lynch 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 Merrill Lynch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Merrill Lynch.
Diversification Opportunities for Walker Dunlop and Merrill Lynch
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Walker and Merrill is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Merrill Lynch in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Merrill Lynch 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 Merrill Lynch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merrill Lynch has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Merrill Lynch go up and down completely randomly.
Pair Corralation between Walker Dunlop and Merrill Lynch
If you would invest 10,712 in Walker Dunlop on September 2, 2024 and sell it today you would earn a total of 306.00 from holding Walker Dunlop or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Walker Dunlop vs. Merrill Lynch
Performance |
| Timeline |
| Walker Dunlop |
| Merrill Lynch |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Walker Dunlop and Merrill Lynch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Merrill Lynch
The main advantage of trading using opposite Walker Dunlop and Merrill Lynch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Merrill Lynch 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 Merrill Lynch will offset losses from the drop in Merrill Lynch'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 |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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