Correlation Between Walker Dunlop and Short-term Fund

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

By analyzing existing cross correlation between Walker Dunlop and Short Term Fund Institutional, you can compare the effects of market volatilities on Walker Dunlop and Short-term Fund 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 Short-term Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Short-term Fund.

Diversification Opportunities for Walker Dunlop and Short-term Fund

0.2

Correlation Coefficient

Walker Dunlop  Short-term Fund

Modest diversification

The 3 months correlation between Walker and Short-term is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Short Term Fund Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Short Term Fund 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 Short-term Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Short Term Fund has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Short-term Fund go up and down completely randomly.

Pair Corralation between Walker Dunlop and Short-term Fund

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 18.88 times more return on investment than Short-term Fund. However, Walker Dunlop is 18.88 times more volatile than Short Term Fund Institutional. It trades about 0.04 of its potential returns per unit of risk. Short Term Fund Institutional is currently generating about 0.22 per unit of risk. If you would invest  10,603  in Walker Dunlop on September 5, 2024 and sell it today you would earn a total of  313.00  from holding Walker Dunlop or generate 2.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Walker Dunlop  vs.  Short Term Fund Institutional

Walker Dunlop

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Walker Dunlop are ranked lower than 2 (%) 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.

Short Term Fund

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Short Term Fund Institutional are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Short-term Fund is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Walker Dunlop and Short-term Fund

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

The idea behind Walker Dunlop and Short Term Fund Institutional 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.