Correlation Between Walker Dunlop and AG Mortgage
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and AG Mortgage 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 AG Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and AG Mortgage Investment, you can compare the effects of market volatilities on Walker Dunlop and AG Mortgage 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 AG Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and AG Mortgage.
Diversification Opportunities for Walker Dunlop and AG Mortgage
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Walker and MITN is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and AG Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AG Mortgage Investment 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 AG Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AG Mortgage Investment has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and AG Mortgage go up and down completely randomly.
Pair Corralation between Walker Dunlop and AG Mortgage
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 2.99 times less return on investment than AG Mortgage. In addition to that, Walker Dunlop is 9.43 times more volatile than AG Mortgage Investment. It trades about 0.01 of its total potential returns per unit of risk. AG Mortgage Investment is currently generating about 0.35 per unit of volatility. If you would invest 2,467 in AG Mortgage Investment on November 4, 2024 and sell it today you would earn a total of 40.00 from holding AG Mortgage Investment or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. AG Mortgage Investment
Performance |
| Timeline |
| Walker Dunlop |
| AG Mortgage Investment |
Walker Dunlop and AG Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and AG Mortgage
The main advantage of trading using opposite Walker Dunlop and AG Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, AG Mortgage 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 AG Mortgage will offset losses from the drop in AG Mortgage'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 |
| AG Mortgage vs. Romana Food Brands | AG Mortgage vs. Kellanova | AG Mortgage vs. SEI Investments | AG Mortgage vs. FitLife Brands, Common |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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