Correlation Between Walker Dunlop and JetBlue Airways
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and JetBlue Airways 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 JetBlue Airways into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and JetBlue Airways, you can compare the effects of market volatilities on Walker Dunlop and JetBlue Airways 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 JetBlue Airways. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and JetBlue Airways.
Diversification Opportunities for Walker Dunlop and JetBlue Airways
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Walker and JetBlue is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and JetBlue Airways in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JetBlue Airways 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 JetBlue Airways. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JetBlue Airways has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and JetBlue Airways go up and down completely randomly.
Pair Corralation between Walker Dunlop and JetBlue Airways
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.57 times more return on investment than JetBlue Airways. However, Walker Dunlop is 1.76 times less risky than JetBlue Airways. It trades about 0.04 of its potential returns per unit of risk. JetBlue Airways is currently generating about 0.01 per unit of risk. If you would invest 8,063 in Walker Dunlop on August 24, 2024 and sell it today you would earn a total of 2,786 from holding Walker Dunlop or generate 34.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. JetBlue Airways
Performance |
| Timeline |
| Walker Dunlop |
| JetBlue Airways |
Walker Dunlop and JetBlue Airways Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and JetBlue Airways
The main advantage of trading using opposite Walker Dunlop and JetBlue Airways positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, JetBlue Airways 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 JetBlue Airways will offset losses from the drop in JetBlue Airways' 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 |
| JetBlue Airways vs. United Airlines Holdings | JetBlue Airways vs. Applied Materials | JetBlue Airways vs. Southern Copper | JetBlue Airways vs. Cognizant Technology Solutions |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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