Correlation Between Walker Dunlop and Praxis Growth
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Praxis Growth 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 Praxis Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Praxis Growth Index, you can compare the effects of market volatilities on Walker Dunlop and Praxis Growth 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 Praxis Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Praxis Growth.
Diversification Opportunities for Walker Dunlop and Praxis Growth
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Walker and Praxis is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Praxis Growth Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Praxis Growth Index 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 Praxis Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Praxis Growth Index has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Praxis Growth go up and down completely randomly.
Pair Corralation between Walker Dunlop and Praxis Growth
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the Praxis Growth. In addition to that, Walker Dunlop is 1.23 times more volatile than Praxis Growth Index. It trades about -0.08 of its total potential returns per unit of risk. Praxis Growth Index is currently generating about 0.07 per unit of volatility. If you would invest 4,830 in Praxis Growth Index on August 27, 2024 and sell it today you would earn a total of 74.00 from holding Praxis Growth Index or generate 1.53% 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. Praxis Growth Index
Performance |
| Timeline |
| Walker Dunlop |
| Praxis Growth Index |
Walker Dunlop and Praxis Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Praxis Growth
The main advantage of trading using opposite Walker Dunlop and Praxis Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Praxis Growth 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 Praxis Growth will offset losses from the drop in Praxis Growth'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 |
| Praxis Growth vs. Praxis Small Cap | Praxis Growth vs. Praxis Small Cap | Praxis Growth vs. Praxis International Index | Praxis Growth vs. Praxis Value Index |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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