Correlation Between Walmart and Manulife Financial
Can any of the company-specific risk be diversified away by investing in both Walmart and Manulife Financial 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 Walmart and Manulife Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart Inc CDR and Manulife Financial Corp, you can compare the effects of market volatilities on Walmart and Manulife Financial 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 Walmart with a short position of Manulife Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Manulife Financial.
Diversification Opportunities for Walmart and Manulife Financial
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Walmart and Manulife is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Walmart Inc CDR and Manulife Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Financial Corp and Walmart 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 Walmart Inc CDR are associated (or correlated) with Manulife Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Financial Corp has no effect on the direction of Walmart i.e., Walmart and Manulife Financial go up and down completely randomly.
Pair Corralation between Walmart and Manulife Financial
Assuming the 90 days trading horizon Walmart Inc CDR is expected to generate 1.44 times more return on investment than Manulife Financial. However, Walmart is 1.44 times more volatile than Manulife Financial Corp. It trades about 0.38 of its potential returns per unit of risk. Manulife Financial Corp is currently generating about -0.14 per unit of risk. If you would invest 3,605 in Walmart Inc CDR on August 29, 2024 and sell it today you would earn a total of 369.00 from holding Walmart Inc CDR or generate 10.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walmart Inc CDR vs. Manulife Financial Corp
Performance |
| Timeline |
| Walmart Inc CDR |
| Manulife Financial Corp |
Walmart and Manulife Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Manulife Financial
The main advantage of trading using opposite Walmart and Manulife Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Manulife Financial 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 Manulife Financial will offset losses from the drop in Manulife Financial's long position.| Walmart vs. Nicola Mining | Walmart vs. Northstar Clean Technologies | Walmart vs. North American Construction | Walmart vs. Air Canada |
| Manulife Financial vs. Walmart Inc CDR | Manulife Financial vs. Amazon CDR | Manulife Financial vs. Berkshire Hathaway CDR | Manulife Financial vs. UnitedHealth Group CDR |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Transaction History View history of all your transactions and understand their impact on performance |