Correlation Between Walker Dunlop and Bridge Builder

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

By analyzing existing cross correlation between Walker Dunlop and Bridge Builder Smallmid, you can compare the effects of market volatilities on Walker Dunlop and Bridge Builder 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 Bridge Builder. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Bridge Builder.

Diversification Opportunities for Walker Dunlop and Bridge Builder

0.18

Correlation Coefficient

Walker Dunlop  Bridge Builder

Average diversification

The 3 months correlation between Walker and Bridge is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Bridge Builder Smallmid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridge Builder Smallmid 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 Bridge Builder. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridge Builder Smallmid has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Bridge Builder go up and down completely randomly.

Pair Corralation between Walker Dunlop and Bridge Builder

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 2.01 times less return on investment than Bridge Builder. In addition to that, Walker Dunlop is 2.41 times more volatile than Bridge Builder Smallmid. It trades about 0.04 of its total potential returns per unit of risk. Bridge Builder Smallmid is currently generating about 0.21 per unit of volatility. If you would invest  1,503  in Bridge Builder Smallmid on May 3, 2025 and sell it today you would earn a total of  175.00  from holding Bridge Builder Smallmid or generate 11.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Walker Dunlop  vs.  Bridge Builder Smallmid

Walker Dunlop

Risk-Adjusted Performance

Insignificant

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 current stock price tumult, may contribute to shorter-term losses for the shareholders.

Bridge Builder Smallmid

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bridge Builder Smallmid are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly unfluctuating basic indicators, Bridge Builder may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Walker Dunlop and Bridge Builder

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

The idea behind Walker Dunlop and Bridge Builder Smallmid 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..