Correlation Between Walker Dunlop and Emerging Markets

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

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

Diversification Opportunities for Walker Dunlop and Emerging Markets

0.49

Correlation Coefficient

Walker Dunlop  Emerging Markets

Very weak diversification

The 3 months correlation between Walker and Emerging is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Emerging Markets Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets Equity 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 Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets Equity has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Emerging Markets go up and down completely randomly.

Pair Corralation between Walker Dunlop and Emerging Markets

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.1 times less return on investment than Emerging Markets. In addition to that, Walker Dunlop is 2.27 times more volatile than Emerging Markets Equity. It trades about 0.07 of its total potential returns per unit of risk. Emerging Markets Equity is currently generating about 0.18 per unit of volatility. If you would invest  1,117  in Emerging Markets Equity on July 22, 2025 and sell it today you would earn a total of  116.00  from holding Emerging Markets Equity or generate 10.38% return on investment over 90 days.

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

Walker Dunlop  vs.  Emerging Markets Equity

Walker Dunlop

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Walker Dunlop are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting fundamental indicators, Walker Dunlop may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Emerging Markets Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Emerging Markets Equity are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Emerging Markets may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Pair Trading with Walker Dunlop and Emerging Markets

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

The idea behind Walker Dunlop and Emerging Markets Equity 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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.