Correlation Between Walker Dunlop and Exxon
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Exxon 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 Exxon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and EXXON MOBIL CDR, you can compare the effects of market volatilities on Walker Dunlop and Exxon 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 Exxon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Exxon.
Diversification Opportunities for Walker Dunlop and Exxon
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Walker and Exxon is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and EXXON MOBIL CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EXXON MOBIL CDR 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 Exxon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EXXON MOBIL CDR has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Exxon go up and down completely randomly.
Pair Corralation between Walker Dunlop and Exxon
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the Exxon. In addition to that, Walker Dunlop is 1.37 times more volatile than EXXON MOBIL CDR. It trades about 0.0 of its total potential returns per unit of risk. EXXON MOBIL CDR is currently generating about 0.05 per unit of volatility. If you would invest 2,157 in EXXON MOBIL CDR on August 28, 2024 and sell it today you would earn a total of 50.00 from holding EXXON MOBIL CDR or generate 2.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Walker Dunlop vs. EXXON MOBIL CDR
Performance |
| Timeline |
| Walker Dunlop |
| EXXON MOBIL CDR |
Walker Dunlop and Exxon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Exxon
The main advantage of trading using opposite Walker Dunlop and Exxon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Exxon 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 Exxon will offset losses from the drop in Exxon'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 |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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