Correlation Between Walker Dunlop and New Alternatives
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and New Alternatives 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 New Alternatives into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and New Alternatives Fund, you can compare the effects of market volatilities on Walker Dunlop and New Alternatives 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 New Alternatives. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and New Alternatives.
Diversification Opportunities for Walker Dunlop and New Alternatives
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Walker and New is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and New Alternatives Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Alternatives 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 New Alternatives. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Alternatives has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and New Alternatives go up and down completely randomly.
Pair Corralation between Walker Dunlop and New Alternatives
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.79 times more return on investment than New Alternatives. However, Walker Dunlop is 1.79 times more volatile than New Alternatives Fund. It trades about 0.06 of its potential returns per unit of risk. New Alternatives Fund is currently generating about 0.06 per unit of risk. If you would invest 9,181 in Walker Dunlop on September 1, 2024 and sell it today you would earn a total of 1,837 from holding Walker Dunlop or generate 20.01% 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. New Alternatives Fund
Performance |
| Timeline |
| Walker Dunlop |
| New Alternatives |
Walker Dunlop and New Alternatives Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and New Alternatives
The main advantage of trading using opposite Walker Dunlop and New Alternatives positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, New Alternatives 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 New Alternatives will offset losses from the drop in New Alternatives' 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 |
| New Alternatives vs. Guinness Atkinson Alternative | New Alternatives vs. Calvert Global Energy | New Alternatives vs. Portfolio 21 Global | New Alternatives vs. Green Century Balanced |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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