Correlation Between Walmart and Accretion Acquisition

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

By analyzing existing cross correlation between Walmart and Accretion Acquisition Corp, you can compare the effects of market volatilities on Walmart and Accretion Acquisition 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 Accretion Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Accretion Acquisition.

Diversification Opportunities for Walmart and Accretion Acquisition

-0.41

Correlation Coefficient

Walmart  Accretion Acquisition

Very good diversification

The 3 months correlation between Walmart and Accretion is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Accretion Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accretion Acquisition 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 Accretion Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accretion Acquisition has no effect on the direction of Walmart i.e., Walmart and Accretion Acquisition go up and down completely randomly.

Pair Corralation between Walmart and Accretion Acquisition

If you would invest  8,060  in Walmart on September 13, 2024 and sell it today you would earn a total of  1,436  from holding Walmart or generate 17.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.59%
Values	Daily Returns

Walmart  vs.  Accretion Acquisition Corp

Walmart

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Walmart are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain primary indicators, Walmart unveiled solid returns over the last few months and may actually be approaching a breakup point.

Accretion Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Accretion Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Accretion Acquisition is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Walmart and Accretion Acquisition

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

The idea behind Walmart and Accretion Acquisition Corp 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.