Correlation Between Walker Dunlop and Scandinavian Brake
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Scandinavian Brake 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 Scandinavian Brake into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Scandinavian Brake Systems, you can compare the effects of market volatilities on Walker Dunlop and Scandinavian Brake 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 Scandinavian Brake. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Scandinavian Brake.
Diversification Opportunities for Walker Dunlop and Scandinavian Brake
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Walker and Scandinavian is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Scandinavian Brake Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Brake 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 Scandinavian Brake. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandinavian Brake has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Scandinavian Brake go up and down completely randomly.
Pair Corralation between Walker Dunlop and Scandinavian Brake
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the Scandinavian Brake. In addition to that, Walker Dunlop is 1.58 times more volatile than Scandinavian Brake Systems. It trades about -0.04 of its total potential returns per unit of risk. Scandinavian Brake Systems is currently generating about 0.03 per unit of volatility. If you would invest 1,170 in Scandinavian Brake Systems on October 26, 2024 and sell it today you would earn a total of 50.00 from holding Scandinavian Brake Systems or generate 4.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
Walker Dunlop vs. Scandinavian Brake Systems
Performance |
| Timeline |
| Walker Dunlop |
| Scandinavian Brake |
Walker Dunlop and Scandinavian Brake Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Scandinavian Brake
The main advantage of trading using opposite Walker Dunlop and Scandinavian Brake positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Scandinavian Brake 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 Scandinavian Brake will offset losses from the drop in Scandinavian Brake'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 |
| Scandinavian Brake vs. SKAKO AS | Scandinavian Brake vs. Newcap Holding AS | Scandinavian Brake vs. Columbus AS | Scandinavian Brake vs. Rovsing AS |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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