Correlation Between Walker Dunlop and SPDR MSCI

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

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

Diversification Opportunities for Walker Dunlop and SPDR MSCI

0.07

Correlation Coefficient

Walker Dunlop  SPDR MSCI

Significant diversification

The 3 months correlation between Walker and SPDR is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and SPDR MSCI Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR MSCI Emerging 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 SPDR MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR MSCI Emerging has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and SPDR MSCI go up and down completely randomly.

Pair Corralation between Walker Dunlop and SPDR MSCI

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 13.67 times less return on investment than SPDR MSCI. In addition to that, Walker Dunlop is 3.34 times more volatile than SPDR MSCI Emerging. It trades about 0.01 of its total potential returns per unit of risk. SPDR MSCI Emerging is currently generating about 0.26 per unit of volatility. If you would invest  5,757  in SPDR MSCI Emerging on April 29, 2025 and sell it today you would earn a total of  629.00  from holding SPDR MSCI Emerging or generate 10.93% 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.  SPDR MSCI Emerging

Walker Dunlop

Risk-Adjusted Performance

Very Weak

Over the last 90 days Walker Dunlop has generated negative risk-adjusted returns adding no value to investors with long positions. 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.

SPDR MSCI Emerging

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR MSCI Emerging are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, SPDR MSCI may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Walker Dunlop and SPDR MSCI

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

The idea behind Walker Dunlop and SPDR MSCI Emerging 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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.