Correlation Between Walker Dunlop and WINMARK
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and WINMARK 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 WINMARK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and WINMARK, you can compare the effects of market volatilities on Walker Dunlop and WINMARK 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 WINMARK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and WINMARK.
Diversification Opportunities for Walker Dunlop and WINMARK
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Walker and WINMARK is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and WINMARK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WINMARK 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 WINMARK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WINMARK has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and WINMARK go up and down completely randomly.
Pair Corralation between Walker Dunlop and WINMARK
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.0 times more return on investment than WINMARK. However, Walker Dunlop is 1.0 times less risky than WINMARK. It trades about 0.04 of its potential returns per unit of risk. WINMARK is currently generating about 0.0 per unit of risk. If you would invest 9,340 in Walker Dunlop on September 4, 2024 and sell it today you would earn a total of 1,576 from holding Walker Dunlop or generate 16.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Walker Dunlop vs. WINMARK
Performance |
| Timeline |
| Walker Dunlop |
| WINMARK |
Walker Dunlop and WINMARK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and WINMARK
The main advantage of trading using opposite Walker Dunlop and WINMARK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, WINMARK 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 WINMARK will offset losses from the drop in WINMARK'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 |
| WINMARK vs. SALESFORCE INC CDR | WINMARK vs. AOI Electronics Co | WINMARK vs. STORE ELECTRONIC | WINMARK vs. GungHo Online Entertainment |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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