Correlation Between Walker Dunlop and SAF Holland
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and SAF Holland 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 SAF Holland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and SAF Holland SA, you can compare the effects of market volatilities on Walker Dunlop and SAF Holland 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 SAF Holland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and SAF Holland.
Diversification Opportunities for Walker Dunlop and SAF Holland
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Walker and SAF is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and SAF Holland SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAF Holland SA 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 SAF Holland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAF Holland SA has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and SAF Holland go up and down completely randomly.
Pair Corralation between Walker Dunlop and SAF Holland
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the SAF Holland. But the stock apears to be less risky and, when comparing its historical volatility, Walker Dunlop is 2.0 times less risky than SAF Holland. The stock trades about -0.07 of its potential returns per unit of risk. The SAF Holland SA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,484 in SAF Holland SA on September 12, 2024 and sell it today you would lose (4.00) from holding SAF Holland SA or give up 0.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Walker Dunlop vs. SAF Holland SA
Performance |
| Timeline |
| Walker Dunlop |
| SAF Holland SA |
Walker Dunlop and SAF Holland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and SAF Holland
The main advantage of trading using opposite Walker Dunlop and SAF Holland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, SAF Holland 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 SAF Holland will offset losses from the drop in SAF Holland'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 |
| SAF Holland vs. SALESFORCE INC CDR | SAF Holland vs. Carsales | SAF Holland vs. Dairy Farm International | SAF Holland vs. CANON MARKETING JP |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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