Correlation Between Walmart and SEI Exchange
Can any of the company-specific risk be diversified away by investing in both Walmart and SEI Exchange 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 SEI Exchange into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and SEI Exchange Traded, you can compare the effects of market volatilities on Walmart and SEI Exchange 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 SEI Exchange. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and SEI Exchange.
Diversification Opportunities for Walmart and SEI Exchange
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Walmart and SEI is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and SEI Exchange Traded in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI Exchange Traded 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 SEI Exchange. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEI Exchange Traded has no effect on the direction of Walmart i.e., Walmart and SEI Exchange go up and down completely randomly.
Pair Corralation between Walmart and SEI Exchange
Considering the 90-day investment horizon Walmart is expected to generate 1.58 times more return on investment than SEI Exchange. However, Walmart is 1.58 times more volatile than SEI Exchange Traded. It trades about 0.18 of its potential returns per unit of risk. SEI Exchange Traded is currently generating about 0.08 per unit of risk. If you would invest 6,549 in Walmart on November 28, 2024 and sell it today you would earn a total of 3,220 from holding Walmart or generate 49.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walmart vs. SEI Exchange Traded
Performance |
| Timeline |
| Walmart |
| SEI Exchange Traded |
Walmart and SEI Exchange Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and SEI Exchange
The main advantage of trading using opposite Walmart and SEI Exchange positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, SEI Exchange 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 SEI Exchange will offset losses from the drop in SEI Exchange's long position.| Walmart vs. Target | Walmart vs. Aquagold International | Walmart vs. Thrivent High Yield | Walmart vs. Morningstar Unconstrained Allocation |
| SEI Exchange vs. FT Vest Equity | SEI Exchange vs. Northern Lights | SEI Exchange vs. Dimensional International High | SEI Exchange vs. First Trust Exchange Traded |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |