Correlation Between Walmart and NUCOR
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By analyzing existing cross correlation between Walmart and NUCOR P 52, you can compare the effects of market volatilities on Walmart and NUCOR 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 NUCOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and NUCOR.
Diversification Opportunities for Walmart and NUCOR
Very weak diversification
The 3 months correlation between Walmart and NUCOR is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and NUCOR P 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NUCOR P 52 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 NUCOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NUCOR P 52 has no effect on the direction of Walmart i.e., Walmart and NUCOR go up and down completely randomly.
Pair Corralation between Walmart and NUCOR
Considering the 90-day investment horizon Walmart is expected to generate 0.27 times more return on investment than NUCOR. However, Walmart is 3.65 times less risky than NUCOR. It trades about 0.26 of its potential returns per unit of risk. NUCOR P 52 is currently generating about -0.05 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 Together |
| Strength | Weak |
| Accuracy | 31.25% |
| Values | Daily Returns |
Walmart vs. NUCOR P 52
Performance |
| Timeline |
| Walmart |
| NUCOR P 52 |
Walmart and NUCOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and NUCOR
The main advantage of trading using opposite Walmart and NUCOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, NUCOR 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 NUCOR will offset losses from the drop in NUCOR's long position.| Walmart vs. Costco Wholesale Corp | Walmart vs. Dollar Tree | Walmart vs. BJs Wholesale Club | Walmart vs. Target |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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