Correlation Between Walmart and Anton Oilfield

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

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

Diversification Opportunities for Walmart and Anton Oilfield

-0.82

Correlation Coefficient

Walmart  Anton Oilfield

Pay attention - limited upside

The 3 months correlation between Walmart and Anton is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Anton Oilfield Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anton Oilfield Services 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 Anton Oilfield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anton Oilfield Services has no effect on the direction of Walmart i.e., Walmart and Anton Oilfield go up and down completely randomly.

Pair Corralation between Walmart and Anton Oilfield

If you would invest  5,985  in Walmart on February 5, 2024 and sell it today you would lose (3.00) from holding Walmart or give up 0.05% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	95.45%
Values	Daily Returns

Walmart  vs.  Anton Oilfield Services

Walmart

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Walmart are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting primary indicators, Walmart may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Anton Oilfield Services

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anton Oilfield Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Walmart and Anton Oilfield

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

The idea behind Walmart and Anton Oilfield Services 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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.