Correlation Between Walker Dunlop and Smurfit WestRock
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Smurfit WestRock 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 Smurfit WestRock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Smurfit WestRock plc, you can compare the effects of market volatilities on Walker Dunlop and Smurfit WestRock 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 Smurfit WestRock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Smurfit WestRock.
Diversification Opportunities for Walker Dunlop and Smurfit WestRock
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Walker and Smurfit is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Smurfit WestRock plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smurfit WestRock plc 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 Smurfit WestRock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smurfit WestRock plc has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Smurfit WestRock go up and down completely randomly.
Pair Corralation between Walker Dunlop and Smurfit WestRock
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the Smurfit WestRock. In addition to that, Walker Dunlop is 1.42 times more volatile than Smurfit WestRock plc. It trades about -0.03 of its total potential returns per unit of risk. Smurfit WestRock plc is currently generating about -0.02 per unit of volatility. If you would invest 5,386 in Smurfit WestRock plc on November 1, 2024 and sell it today you would lose (45.00) from holding Smurfit WestRock plc or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. Smurfit WestRock plc
Performance |
| Timeline |
| Walker Dunlop |
| Smurfit WestRock plc |
Walker Dunlop and Smurfit WestRock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Smurfit WestRock
The main advantage of trading using opposite Walker Dunlop and Smurfit WestRock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Smurfit WestRock 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 Smurfit WestRock will offset losses from the drop in Smurfit WestRock's long position.| Walker Dunlop vs. Guild Holdings Co | Walker Dunlop vs. Security National Financial | Walker Dunlop vs. Encore Capital Group |
| Smurfit WestRock vs. Chart Industries | Smurfit WestRock vs. Amkor Technology | Smurfit WestRock vs. Acm Research | Smurfit WestRock vs. Coda Octopus Group |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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