Correlation Between Walker Dunlop and Grand Prix
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Grand Prix 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 Grand Prix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Grand Prix International, you can compare the effects of market volatilities on Walker Dunlop and Grand Prix 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 Grand Prix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Grand Prix.
Diversification Opportunities for Walker Dunlop and Grand Prix
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Walker and Grand is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Grand Prix International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Prix International 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 Grand Prix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Prix International has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Grand Prix go up and down completely randomly.
Pair Corralation between Walker Dunlop and Grand Prix
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.54 times more return on investment than Grand Prix. However, Walker Dunlop is 1.54 times more volatile than Grand Prix International. It trades about 0.1 of its potential returns per unit of risk. Grand Prix International is currently generating about -0.02 per unit of risk. 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 Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Walker Dunlop vs. Grand Prix International
Performance |
| Timeline |
| Walker Dunlop |
| Grand Prix International |
Walker Dunlop and Grand Prix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Grand Prix
The main advantage of trading using opposite Walker Dunlop and Grand Prix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Grand Prix 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 Grand Prix will offset losses from the drop in Grand Prix'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 |
| Grand Prix vs. Interlink Communication Public | Grand Prix vs. Aqua Public | Grand Prix vs. BEC World Public | Grand Prix vs. Grande Asset Hotels |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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