Correlation Between Walker Dunlop and SFI INVESTIMENTOS

Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and SFI INVESTIMENTOS 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 Walker Dunlop and SFI INVESTIMENTOS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Walker Dunlop and SFI INVESTIMENTOS DO, you can compare the effects of market volatilities on Walker Dunlop and SFI INVESTIMENTOS 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 Walker Dunlop with a short position of SFI INVESTIMENTOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and SFI INVESTIMENTOS.

Diversification Opportunities for Walker Dunlop and SFI INVESTIMENTOS

-0.02

Correlation Coefficient

Walker Dunlop  SFI INVESTIMENTOS

Good diversification

The 3 months correlation between Walker and SFI is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and SFI INVESTIMENTOS DO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SFI INVESTIMENTOS and Walker Dunlop 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 Walker Dunlop are associated (or correlated) with SFI INVESTIMENTOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SFI INVESTIMENTOS has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and SFI INVESTIMENTOS go up and down completely randomly.

Pair Corralation between Walker Dunlop and SFI INVESTIMENTOS

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.66 times more return on investment than SFI INVESTIMENTOS. However, Walker Dunlop is 1.51 times less risky than SFI INVESTIMENTOS. It trades about 0.04 of its potential returns per unit of risk. SFI INVESTIMENTOS DO is currently generating about -0.11 per unit of risk. If you would invest  10,350  in Walker Dunlop on September 12, 2024 and sell it today you would earn a total of  392.00  from holding Walker Dunlop or generate 3.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.88%
Values	Daily Returns

Walker Dunlop  vs.  SFI INVESTIMENTOS DO

Walker Dunlop

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Walker Dunlop are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Walker Dunlop is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

SFI INVESTIMENTOS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SFI INVESTIMENTOS DO has generated negative risk-adjusted returns adding no value to fund investors. Despite weak performance in the last few months, the Fund's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Walker Dunlop and SFI INVESTIMENTOS

The main advantage of trading using opposite Walker Dunlop and SFI INVESTIMENTOS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, SFI INVESTIMENTOS 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 SFI INVESTIMENTOS will offset losses from the drop in SFI INVESTIMENTOS's long position.

The idea behind Walker Dunlop and SFI INVESTIMENTOS DO pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.