Correlation Between Walker Dunlop and CI Financial

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

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

Diversification Opportunities for Walker Dunlop and CI Financial

0.2

Correlation Coefficient

Walker Dunlop  CI Financial

Modest diversification

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

Pair Corralation between Walker Dunlop and CI Financial

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 14.91 times more return on investment than CI Financial. However, Walker Dunlop is 14.91 times more volatile than CI Financial Corp. It trades about 0.03 of its potential returns per unit of risk. CI Financial Corp is currently generating about 0.22 per unit of risk. If you would invest  7,338  in Walker Dunlop on May 1, 2025 and sell it today you would earn a total of  223.00  from holding Walker Dunlop or generate 3.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Walker Dunlop  vs.  CI Financial Corp

Walker Dunlop

Risk-Adjusted Performance

Insignificant

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

CI Financial Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CI Financial Corp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, CI Financial is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Walker Dunlop and CI Financial

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

The idea behind Walker Dunlop and CI Financial 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.