Correlation Between Walker Dunlop and RioCan Real
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and RioCan Real 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 RioCan Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and RioCan Real Estate, you can compare the effects of market volatilities on Walker Dunlop and RioCan Real 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 RioCan Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and RioCan Real.
Diversification Opportunities for Walker Dunlop and RioCan Real
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Walker and RioCan is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and RioCan Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RioCan Real Estate 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 RioCan Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RioCan Real Estate has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and RioCan Real go up and down completely randomly.
Pair Corralation between Walker Dunlop and RioCan Real
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.52 times more return on investment than RioCan Real. However, Walker Dunlop is 1.52 times more volatile than RioCan Real Estate. It trades about 0.0 of its potential returns per unit of risk. RioCan Real Estate is currently generating about -0.11 per unit of risk. If you would invest 9,442 in Walker Dunlop on January 25, 2024 and sell it today you would lose (38.00) from holding Walker Dunlop or give up 0.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walker Dunlop vs. RioCan Real Estate
Performance |
| Timeline |
| Walker Dunlop |
| RioCan Real Estate |
Walker Dunlop and RioCan Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and RioCan Real
The main advantage of trading using opposite Walker Dunlop and RioCan Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, RioCan Real 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 RioCan Real will offset losses from the drop in RioCan Real's long position.| Walker Dunlop vs. Mr Cooper Group | Walker Dunlop vs. Ocwen Financial | Walker Dunlop vs. Velocity FinancialLlc | Walker Dunlop vs. Security National Financial |
| RioCan Real vs. SmartCentres Real Estate | RioCan Real vs. HR Real Estate | RioCan Real vs. Fortis Inc | RioCan Real vs. Enbridge |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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