Correlation Between Walker Dunlop and UMH Properties
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and UMH Properties 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 UMH Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and UMH Properties, you can compare the effects of market volatilities on Walker Dunlop and UMH Properties 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 UMH Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and UMH Properties.
Diversification Opportunities for Walker Dunlop and UMH Properties
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Walker and UMH is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and UMH Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UMH Properties 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 UMH Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UMH Properties has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and UMH Properties go up and down completely randomly.
Pair Corralation between Walker Dunlop and UMH Properties
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 2.46 times more return on investment than UMH Properties. However, Walker Dunlop is 2.46 times more volatile than UMH Properties. It trades about 0.08 of its potential returns per unit of risk. UMH Properties is currently generating about 0.06 per unit of risk. If you would invest 5,977 in Walker Dunlop on August 31, 2024 and sell it today you would earn a total of 5,105 from holding Walker Dunlop or generate 85.41% 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. UMH Properties
Performance |
| Timeline |
| Walker Dunlop |
| UMH Properties |
Walker Dunlop and UMH Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and UMH Properties
The main advantage of trading using opposite Walker Dunlop and UMH Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, UMH Properties 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 UMH Properties will offset losses from the drop in UMH Properties' 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 |
| UMH Properties vs. American Homes 4 | UMH Properties vs. Mid America Apartment Communities | UMH Properties vs. Clipper Realty | UMH Properties vs. American Homes 4 |
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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