Correlation Between Walmart and AMGEN
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By analyzing existing cross correlation between Walmart and AMGEN INC 515, you can compare the effects of market volatilities on Walmart and AMGEN 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 AMGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and AMGEN.
Diversification Opportunities for Walmart and AMGEN
Excellent diversification
The 3 months correlation between Walmart and AMGEN is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and AMGEN INC 515 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGEN INC 515 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 AMGEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGEN INC 515 has no effect on the direction of Walmart i.e., Walmart and AMGEN go up and down completely randomly.
Pair Corralation between Walmart and AMGEN
Considering the 90-day investment horizon Walmart is expected to generate 0.66 times more return on investment than AMGEN. However, Walmart is 1.52 times less risky than AMGEN. It trades about 0.54 of its potential returns per unit of risk. AMGEN INC 515 is currently generating about 0.08 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 | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Walmart vs. AMGEN INC 515
Performance |
| Timeline |
| Walmart |
| AMGEN INC 515 |
Walmart and AMGEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and AMGEN
The main advantage of trading using opposite Walmart and AMGEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, AMGEN 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 AMGEN will offset losses from the drop in AMGEN's long position.| Walmart vs. Ingles Markets Incorporated | Walmart vs. Grocery Outlet Holding | Walmart vs. Ocado Group plc | Walmart vs. Sprouts Farmers Market |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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