Correlation Between X-FAB Silicon and Walker Dunlop
Can any of the company-specific risk be diversified away by investing in both X-FAB Silicon and Walker Dunlop at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining X-FAB Silicon and Walker Dunlop into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and Walker Dunlop, you can compare the effects of market volatilities on X-FAB Silicon and Walker Dunlop 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 X-FAB Silicon with a short position of Walker Dunlop. Check out your portfolio center. Please also check ongoing floating volatility patterns of X-FAB Silicon and Walker Dunlop.
Diversification Opportunities for X-FAB Silicon and Walker Dunlop
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between X-FAB and Walker is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and Walker Dunlop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walker Dunlop and X-FAB Silicon 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 X FAB Silicon Foundries are associated (or correlated) with Walker Dunlop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walker Dunlop has no effect on the direction of X-FAB Silicon i.e., X-FAB Silicon and Walker Dunlop go up and down completely randomly.
Pair Corralation between X-FAB Silicon and Walker Dunlop
Assuming the 90 days trading horizon X FAB Silicon Foundries is expected to generate 1.38 times more return on investment than Walker Dunlop. However, X-FAB Silicon is 1.38 times more volatile than Walker Dunlop. It trades about 0.11 of its potential returns per unit of risk. Walker Dunlop is currently generating about -0.32 per unit of risk. If you would invest 491.00 in X FAB Silicon Foundries on October 15, 2024 and sell it today you would earn a total of 21.00 from holding X FAB Silicon Foundries or generate 4.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. Walker Dunlop
Performance |
| Timeline |
| X FAB Silicon |
| Walker Dunlop |
X-FAB Silicon and Walker Dunlop Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X-FAB Silicon and Walker Dunlop
The main advantage of trading using opposite X-FAB Silicon and Walker Dunlop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X-FAB Silicon position performs unexpectedly, Walker Dunlop 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 Walker Dunlop will offset losses from the drop in Walker Dunlop's long position.| X-FAB Silicon vs. NTG Nordic Transport | X-FAB Silicon vs. SPORT LISBOA E | X-FAB Silicon vs. SLR Investment Corp | X-FAB Silicon vs. Algonquin Power Utilities |
| Walker Dunlop vs. FANDIFI TECHNOLOGY P | Walker Dunlop vs. Sanyo Chemical Industries | Walker Dunlop vs. X FAB Silicon Foundries | Walker Dunlop vs. TRI CHEMICAL LABORATINC |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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