Correlation Between Walmart and SOUTHERN
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By analyzing existing cross correlation between Walmart and SOUTHERN CALIF GAS, you can compare the effects of market volatilities on Walmart and SOUTHERN 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 SOUTHERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and SOUTHERN.
Diversification Opportunities for Walmart and SOUTHERN
Very good diversification
The 3 months correlation between Walmart and SOUTHERN is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and SOUTHERN CALIF GAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOUTHERN CALIF GAS 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 SOUTHERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOUTHERN CALIF GAS has no effect on the direction of Walmart i.e., Walmart and SOUTHERN go up and down completely randomly.
Pair Corralation between Walmart and SOUTHERN
Considering the 90-day investment horizon Walmart is expected to generate 1.27 times more return on investment than SOUTHERN. However, Walmart is 1.27 times more volatile than SOUTHERN CALIF GAS. It trades about 0.49 of its potential returns per unit of risk. SOUTHERN CALIF GAS is currently generating about -0.22 per unit of risk. If you would invest 8,421 in Walmart on September 12, 2024 and sell it today you would earn a total of 1,034 from holding Walmart or generate 12.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.71% |
| Values | Daily Returns |
Walmart vs. SOUTHERN CALIF GAS
Performance |
| Timeline |
| Walmart |
| SOUTHERN CALIF GAS |
Walmart and SOUTHERN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and SOUTHERN
The main advantage of trading using opposite Walmart and SOUTHERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, SOUTHERN 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 SOUTHERN will offset losses from the drop in SOUTHERN's long position.| Walmart vs. Costco Wholesale Corp | Walmart vs. Dollar Tree | Walmart vs. BJs Wholesale Club | Walmart vs. Target |
| SOUTHERN vs. Viemed Healthcare | SOUTHERN vs. Inflection Point Acquisition | SOUTHERN vs. Neogen | SOUTHERN vs. Hurco Companies |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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