Correlation Between Walmart and BROADPEAK

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Walmart and BROADPEAK 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 BROADPEAK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and BROADPEAK SA EO, you can compare the effects of market volatilities on Walmart and BROADPEAK 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 BROADPEAK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and BROADPEAK.

Diversification Opportunities for Walmart and BROADPEAK

-0.7
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Walmart and BROADPEAK is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and BROADPEAK SA EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BROADPEAK SA EO 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 are associated (or correlated) with BROADPEAK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BROADPEAK SA EO has no effect on the direction of Walmart i.e., Walmart and BROADPEAK go up and down completely randomly.

Pair Corralation between Walmart and BROADPEAK

Assuming the 90 days trading horizon Walmart is expected to generate 0.82 times more return on investment than BROADPEAK. However, Walmart is 1.23 times less risky than BROADPEAK. It trades about 0.23 of its potential returns per unit of risk. BROADPEAK SA EO is currently generating about -0.05 per unit of risk. If you would invest  8,751  in Walmart on October 30, 2024 and sell it today you would earn a total of  369.00  from holding Walmart or generate 4.22% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy95.0%
ValuesDaily Returns

Walmart  vs.  BROADPEAK SA EO

 Performance 
       Timeline  
Walmart 

Risk-Adjusted Performance

19 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Walmart are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Walmart unveiled solid returns over the last few months and may actually be approaching a breakup point.
BROADPEAK SA EO 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days BROADPEAK SA EO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Walmart and BROADPEAK Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Walmart and BROADPEAK

The main advantage of trading using opposite Walmart and BROADPEAK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, BROADPEAK 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 BROADPEAK will offset losses from the drop in BROADPEAK's long position.
The idea behind Walmart and BROADPEAK SA EO pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

Other Complementary Tools

Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
USA ETFs
Find actively traded Exchange Traded Funds (ETF) in USA
Bonds Directory
Find actively traded corporate debentures issued by US companies