Correlation Between Walmart and BORGWARNER
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By analyzing existing cross correlation between Walmart and BORGWARNER INC 3375, you can compare the effects of market volatilities on Walmart and BORGWARNER 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 BORGWARNER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and BORGWARNER.
Diversification Opportunities for Walmart and BORGWARNER
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Walmart and BORGWARNER is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and BORGWARNER INC 3375 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BORGWARNER INC 3375 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 BORGWARNER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BORGWARNER INC 3375 has no effect on the direction of Walmart i.e., Walmart and BORGWARNER go up and down completely randomly.
Pair Corralation between Walmart and BORGWARNER
Considering the 90-day investment horizon Walmart is expected to generate 2.63 times more return on investment than BORGWARNER. However, Walmart is 2.63 times more volatile than BORGWARNER INC 3375. It trades about 0.26 of its potential returns per unit of risk. BORGWARNER INC 3375 is currently generating about 0.02 per unit of risk. If you would invest 7,966 in Walmart on September 12, 2024 and sell it today you would earn a total of 1,530 from holding Walmart or generate 19.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 73.44% |
| Values | Daily Returns |
Walmart vs. BORGWARNER INC 3375
Performance |
| Timeline |
| Walmart |
| BORGWARNER INC 3375 |
Walmart and BORGWARNER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and BORGWARNER
The main advantage of trading using opposite Walmart and BORGWARNER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, BORGWARNER 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 BORGWARNER will offset losses from the drop in BORGWARNER's long position.| Walmart vs. Costco Wholesale Corp | Walmart vs. Dollar Tree | Walmart vs. BJs Wholesale Club | Walmart vs. Target |
| BORGWARNER vs. National CineMedia | BORGWARNER vs. Haverty Furniture Companies | BORGWARNER vs. Boston Properties | BORGWARNER vs. Fluent Inc |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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