Correlation Between Walker Dunlop and Haleon Plc
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Haleon Plc 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 Haleon Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Haleon plc, you can compare the effects of market volatilities on Walker Dunlop and Haleon Plc 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 Haleon Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Haleon Plc.
Diversification Opportunities for Walker Dunlop and Haleon Plc
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Walker and Haleon is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Haleon plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haleon plc 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 Haleon Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haleon plc has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Haleon Plc go up and down completely randomly.
Pair Corralation between Walker Dunlop and Haleon Plc
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 44.64 times less return on investment than Haleon Plc. But when comparing it to its historical volatility, Walker Dunlop is 29.05 times less risky than Haleon Plc. It trades about 0.04 of its potential returns per unit of risk. Haleon plc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 339.00 in Haleon plc on August 24, 2024 and sell it today you would earn a total of 116.00 from holding Haleon plc or generate 34.22% 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. Haleon plc
Performance |
| Timeline |
| Walker Dunlop |
| Haleon plc |
Walker Dunlop and Haleon Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Haleon Plc
The main advantage of trading using opposite Walker Dunlop and Haleon Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Haleon Plc 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 Haleon Plc will offset losses from the drop in Haleon Plc's long position.| Walker Dunlop vs. Encore Capital Group | Walker Dunlop vs. Federal Home Loan | Walker Dunlop vs. CNFinance Holdings | Walker Dunlop vs. Greystone Housing Impact |
| Haleon Plc vs. Green Cures Botanical | Haleon Plc vs. Rimrock Gold Corp | Haleon Plc vs. Galexxy Holdings | Haleon Plc vs. Indoor Harvest Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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