Correlation Between Walker Dunlop and Host Hotels
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Host Hotels 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 Host Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Host Hotels Resorts, you can compare the effects of market volatilities on Walker Dunlop and Host Hotels 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 Host Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Host Hotels.
Diversification Opportunities for Walker Dunlop and Host Hotels
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Walker and Host is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Host Hotels Resorts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Host Hotels Resorts 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 Host Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Host Hotels Resorts has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Host Hotels go up and down completely randomly.
Pair Corralation between Walker Dunlop and Host Hotels
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.99 times more return on investment than Host Hotels. However, Walker Dunlop is 1.01 times less risky than Host Hotels. It trades about 0.08 of its potential returns per unit of risk. Host Hotels Resorts is currently generating about 0.01 per unit of risk. If you would invest 9,215 in Walker Dunlop on August 25, 2024 and sell it today you would earn a total of 1,634 from holding Walker Dunlop or generate 17.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.92% |
| Values | Daily Returns |
Walker Dunlop vs. Host Hotels Resorts
Performance |
| Timeline |
| Walker Dunlop |
| Host Hotels Resorts |
Walker Dunlop and Host Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Host Hotels
The main advantage of trading using opposite Walker Dunlop and Host Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Host Hotels 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 Host Hotels will offset losses from the drop in Host Hotels' 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 |
| Host Hotels vs. DELTA AIR LINES | Host Hotels vs. Tower One Wireless | Host Hotels vs. Altair Engineering | Host Hotels vs. 24SEVENOFFICE GROUP AB |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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