Correlation Between Walmart and Golden Dawn
Can any of the company-specific risk be diversified away by investing in both Walmart and Golden Dawn 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 Golden Dawn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Golden Dawn Minerals, you can compare the effects of market volatilities on Walmart and Golden Dawn 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 Golden Dawn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Golden Dawn.
Diversification Opportunities for Walmart and Golden Dawn
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Walmart and Golden is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Golden Dawn Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Dawn Minerals 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 Golden Dawn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Dawn Minerals has no effect on the direction of Walmart i.e., Walmart and Golden Dawn go up and down completely randomly.
Pair Corralation between Walmart and Golden Dawn
Considering the 90-day investment horizon Walmart is expected to generate 1.16 times more return on investment than Golden Dawn. However, Walmart is 1.16 times more volatile than Golden Dawn Minerals. It trades about 0.24 of its potential returns per unit of risk. Golden Dawn Minerals is currently generating about -0.13 per unit of risk. If you would invest 7,029 in Walmart on September 21, 2024 and sell it today you would earn a total of 2,336 from holding Walmart or generate 33.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 51.4% |
| Values | Daily Returns |
Walmart vs. Golden Dawn Minerals
Performance |
| Timeline |
| Walmart |
| Golden Dawn Minerals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Walmart and Golden Dawn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Golden Dawn
The main advantage of trading using opposite Walmart and Golden Dawn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Golden Dawn 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 Golden Dawn will offset losses from the drop in Golden Dawn's long position.The idea behind Walmart and Golden Dawn Minerals 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.| Golden Dawn vs. Canada Silver Cobalt | Golden Dawn vs. Cantex Mine Development | Golden Dawn vs. CopAur Minerals | Golden Dawn vs. Argosy Minerals Limited |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |