Correlation Between Walmart and Macquarie ETF
Can any of the company-specific risk be diversified away by investing in both Walmart and Macquarie ETF 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 Macquarie ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Macquarie ETF Trust, you can compare the effects of market volatilities on Walmart and Macquarie ETF 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 Macquarie ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Macquarie ETF.
Diversification Opportunities for Walmart and Macquarie ETF
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Walmart and Macquarie is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Macquarie ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macquarie ETF Trust 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 Macquarie ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macquarie ETF Trust has no effect on the direction of Walmart i.e., Walmart and Macquarie ETF go up and down completely randomly.
Pair Corralation between Walmart and Macquarie ETF
Considering the 90-day investment horizon Walmart is expected to generate 0.76 times more return on investment than Macquarie ETF. However, Walmart is 1.32 times less risky than Macquarie ETF. It trades about 0.59 of its potential returns per unit of risk. Macquarie ETF Trust is currently generating about -0.01 per unit of risk. If you would invest 9,180 in Walmart on November 9, 2024 and sell it today you would earn a total of 1,105 from holding Walmart or generate 12.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Walmart vs. Macquarie ETF Trust
Performance |
| Timeline |
| Walmart |
| Macquarie ETF Trust |
Walmart and Macquarie ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Macquarie ETF
The main advantage of trading using opposite Walmart and Macquarie ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Macquarie ETF 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 Macquarie ETF will offset losses from the drop in Macquarie ETF's long position.| Walmart vs. Great Western Minerals | Walmart vs. Enterprise Bancorp | Walmart vs. T Rowe Price | Walmart vs. Aviat Networks |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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