Correlation Between Walmart and Oasis Petroleum
Can any of the company-specific risk be diversified away by investing in both Walmart and Oasis Petroleum 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 Oasis Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Oasis Petroleum, you can compare the effects of market volatilities on Walmart and Oasis Petroleum 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 Oasis Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Oasis Petroleum.
Diversification Opportunities for Walmart and Oasis Petroleum
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Walmart and Oasis is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Oasis Petroleum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oasis Petroleum 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 Oasis Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oasis Petroleum has no effect on the direction of Walmart i.e., Walmart and Oasis Petroleum go up and down completely randomly.
Pair Corralation between Walmart and Oasis Petroleum
If you would invest 4,611 in Walmart on November 19, 2024 and sell it today you would earn a total of 5,793 from holding Walmart or generate 125.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Walmart vs. Oasis Petroleum
Performance |
| Timeline |
| Walmart |
| Oasis Petroleum |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Walmart and Oasis Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Oasis Petroleum
The main advantage of trading using opposite Walmart and Oasis Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Oasis Petroleum 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 Oasis Petroleum will offset losses from the drop in Oasis Petroleum's long position.| Walmart vs. Costco Wholesale Corp | Walmart vs. Dollar Tree | Walmart vs. BJs Wholesale Club | Walmart vs. Target |
| Oasis Petroleum vs. BCE Inc | Oasis Petroleum vs. Perseus Mining Limited | Oasis Petroleum vs. Arrow Electronics | Oasis Petroleum vs. GMO Internet |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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