Correlation Between Walmart and Pimco New
Can any of the company-specific risk be diversified away by investing in both Walmart and Pimco New 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 Pimco New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Pimco New York, you can compare the effects of market volatilities on Walmart and Pimco New 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 Pimco New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Pimco New.
Diversification Opportunities for Walmart and Pimco New
Very good diversification
The 3 months correlation between Walmart and Pimco is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Pimco New York in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco New York 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 Pimco New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco New York has no effect on the direction of Walmart i.e., Walmart and Pimco New go up and down completely randomly.
Pair Corralation between Walmart and Pimco New
Considering the 90-day investment horizon Walmart is expected to generate 1.56 times more return on investment than Pimco New. However, Walmart is 1.56 times more volatile than Pimco New York. It trades about 0.54 of its potential returns per unit of risk. Pimco New York is currently generating about 0.03 per unit of risk. If you would invest 8,195 in Walmart on September 1, 2024 and sell it today you would earn a total of 1,055 from holding Walmart or generate 12.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walmart vs. Pimco New York
Performance |
| Timeline |
| Walmart |
| Pimco New York |
Walmart and Pimco New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Pimco New
The main advantage of trading using opposite Walmart and Pimco New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Pimco New 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 Pimco New will offset losses from the drop in Pimco New's long position.| Walmart vs. Ingles Markets Incorporated | Walmart vs. Sendas Distribuidora SA | Walmart vs. Grocery Outlet Holding | Walmart vs. Ocado Group plc |
| Pimco New vs. Pimco New York | Pimco New vs. Pimco California Municipal | Pimco New vs. Pimco Municipal Income | Pimco New vs. Pimco California Municipal |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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