Correlation Between Walmart and Conns
Can any of the company-specific risk be diversified away by investing in both Walmart and Conns 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 Conns into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Conns Inc, you can compare the effects of market volatilities on Walmart and Conns 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 Conns. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Conns.
Diversification Opportunities for Walmart and Conns
Pay attention - limited upside
The 3 months correlation between Walmart and Conns is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Conns Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conns Inc 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 Conns. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conns Inc has no effect on the direction of Walmart i.e., Walmart and Conns go up and down completely randomly.
Pair Corralation between Walmart and Conns
If you would invest 8,139 in Walmart on August 31, 2024 and sell it today you would earn a total of 1,049 from holding Walmart or generate 12.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Walmart vs. Conns Inc
Performance |
| Timeline |
| Walmart |
| Conns Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Walmart and Conns Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Conns
The main advantage of trading using opposite Walmart and Conns positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Conns 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 Conns will offset losses from the drop in Conns' long position.| Walmart vs. Dollar General | Walmart vs. Aquagold International | Walmart vs. Thrivent High Yield | Walmart vs. Morningstar Unconstrained Allocation |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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