Correlation Between Walmart and Janel Corp
Can any of the company-specific risk be diversified away by investing in both Walmart and Janel Corp 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 Janel Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Janel Corp, you can compare the effects of market volatilities on Walmart and Janel Corp 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 Janel Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Janel Corp.
Diversification Opportunities for Walmart and Janel Corp
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Walmart and Janel is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Janel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janel 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 are associated (or correlated) with Janel Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janel Corp has no effect on the direction of Walmart i.e., Walmart and Janel Corp go up and down completely randomly.
Pair Corralation between Walmart and Janel Corp
Considering the 90-day investment horizon Walmart is expected to generate 0.4 times more return on investment than Janel Corp. However, Walmart is 2.52 times less risky than Janel Corp. It trades about 0.25 of its potential returns per unit of risk. Janel Corp is currently generating about -0.06 per unit of risk. If you would invest 6,563 in Walmart on September 1, 2024 and sell it today you would earn a total of 2,687 from holding Walmart or generate 40.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Walmart vs. Janel Corp
Performance |
| Timeline |
| Walmart |
| Janel Corp |
Walmart and Janel Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Janel Corp
The main advantage of trading using opposite Walmart and Janel Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Janel Corp 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 Janel Corp will offset losses from the drop in Janel Corp's long position.| Walmart vs. Ingles Markets Incorporated | Walmart vs. Grocery Outlet Holding | Walmart vs. Ocado Group plc | Walmart vs. Sprouts Farmers Market |
| Janel Corp vs. FedEx | Janel Corp vs. GXO Logistics | Janel Corp vs. JB Hunt Transport | Janel Corp vs. Expeditors International of |
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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