Correlation Between Walmart and DOMTAR
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By analyzing existing cross correlation between Walmart and DOMTAR P 675, you can compare the effects of market volatilities on Walmart and DOMTAR 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 DOMTAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and DOMTAR.
Diversification Opportunities for Walmart and DOMTAR
Average diversification
The 3 months correlation between Walmart and DOMTAR is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and DOMTAR P 675 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DOMTAR P 675 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 DOMTAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DOMTAR P 675 has no effect on the direction of Walmart i.e., Walmart and DOMTAR go up and down completely randomly.
Pair Corralation between Walmart and DOMTAR
Considering the 90-day investment horizon Walmart is expected to generate 0.3 times more return on investment than DOMTAR. However, Walmart is 3.28 times less risky than DOMTAR. It trades about 0.16 of its potential returns per unit of risk. DOMTAR P 675 is currently generating about 0.0 per unit of risk. If you would invest 5,161 in Walmart on September 12, 2024 and sell it today you would earn a total of 4,294 from holding Walmart or generate 83.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.06% |
| Values | Daily Returns |
Walmart vs. DOMTAR P 675
Performance |
| Timeline |
| Walmart |
| DOMTAR P 675 |
Walmart and DOMTAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and DOMTAR
The main advantage of trading using opposite Walmart and DOMTAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, DOMTAR 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 DOMTAR will offset losses from the drop in DOMTAR's long position.| Walmart vs. Costco Wholesale Corp | Walmart vs. Dollar Tree | Walmart vs. BJs Wholesale Club | Walmart vs. Target |
| DOMTAR vs. NETGEAR | DOMTAR vs. Sphere Entertainment Co | DOMTAR vs. Dave Busters Entertainment | DOMTAR vs. Grupo Televisa SAB |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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