Correlation Between Walker Dunlop and CGI
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and CGI 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 CGI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and CGI Inc, you can compare the effects of market volatilities on Walker Dunlop and CGI 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 CGI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and CGI.
Diversification Opportunities for Walker Dunlop and CGI
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Walker and CGI is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and CGI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CGI Inc 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 CGI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CGI Inc has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and CGI go up and down completely randomly.
Pair Corralation between Walker Dunlop and CGI
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 2.44 times less return on investment than CGI. In addition to that, Walker Dunlop is 1.87 times more volatile than CGI Inc. It trades about 0.09 of its total potential returns per unit of risk. CGI Inc is currently generating about 0.41 per unit of volatility. If you would invest 10,826 in CGI Inc on November 8, 2024 and sell it today you would earn a total of 1,092 from holding CGI Inc or generate 10.09% 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. CGI Inc
Performance |
| Timeline |
| Walker Dunlop |
| CGI Inc |
Walker Dunlop and CGI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and CGI
The main advantage of trading using opposite Walker Dunlop and CGI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, CGI 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 CGI will offset losses from the drop in CGI's long position.| Walker Dunlop vs. Guild Holdings Co | Walker Dunlop vs. Encore Capital Group | Walker Dunlop vs. PennyMac Finl Svcs | Walker Dunlop vs. CNFinance Holdings |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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