Correlation Between Walker Dunlop and FT Cboe

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

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

Diversification Opportunities for Walker Dunlop and FT Cboe

0.13

Correlation Coefficient

Walker Dunlop  FT Cboe

Average diversification

The 3 months correlation between Walker and DFEB is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and FT Cboe Vest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Cboe Vest 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 FT Cboe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Cboe Vest has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and FT Cboe go up and down completely randomly.

Pair Corralation between Walker Dunlop and FT Cboe

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.35 times less return on investment than FT Cboe. In addition to that, Walker Dunlop is 5.55 times more volatile than FT Cboe Vest. It trades about 0.04 of its total potential returns per unit of risk. FT Cboe Vest is currently generating about 0.31 per unit of volatility. If you would invest  4,218  in FT Cboe Vest on May 1, 2025 and sell it today you would earn a total of  317.00  from holding FT Cboe Vest or generate 7.52% 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.  FT Cboe Vest

Walker Dunlop

Risk-Adjusted Performance

Weak

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.

FT Cboe Vest

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in FT Cboe Vest are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Despite somewhat abnormal technical and fundamental indicators, FT Cboe may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Walker Dunlop and FT Cboe

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

The idea behind Walker Dunlop and FT Cboe Vest 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .