Correlation Between Walmart and Aptus Drawdown
Can any of the company-specific risk be diversified away by investing in both Walmart and Aptus Drawdown 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 Aptus Drawdown into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Aptus Drawdown Managed, you can compare the effects of market volatilities on Walmart and Aptus Drawdown 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 Aptus Drawdown. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Aptus Drawdown.
Diversification Opportunities for Walmart and Aptus Drawdown
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Walmart and Aptus is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Aptus Drawdown Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptus Drawdown Managed 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 Aptus Drawdown. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptus Drawdown Managed has no effect on the direction of Walmart i.e., Walmart and Aptus Drawdown go up and down completely randomly.
Pair Corralation between Walmart and Aptus Drawdown
Considering the 90-day investment horizon Walmart is expected to generate 1.61 times more return on investment than Aptus Drawdown. However, Walmart is 1.61 times more volatile than Aptus Drawdown Managed. It trades about 0.57 of its potential returns per unit of risk. Aptus Drawdown Managed is currently generating about 0.1 per unit of risk. If you would invest 9,194 in Walmart on November 18, 2024 and sell it today you would earn a total of 1,210 from holding Walmart or generate 13.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walmart vs. Aptus Drawdown Managed
Performance |
| Timeline |
| Walmart |
| Aptus Drawdown Managed |
Walmart and Aptus Drawdown Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Aptus Drawdown
The main advantage of trading using opposite Walmart and Aptus Drawdown positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Aptus Drawdown 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 Aptus Drawdown will offset losses from the drop in Aptus Drawdown's long position.| Walmart vs. BJs Wholesale Club | Walmart vs. Dollar General | Walmart vs. Grocery Outlet Holding | Walmart vs. Kroger Company |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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