Correlation Between Walker Dunlop and Real Estate

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

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

Diversification Opportunities for Walker Dunlop and Real Estate

0.28

Correlation Coefficient

Walker Dunlop  Real Estate

Modest diversification

The 3 months correlation between Walker and Real is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Real Estate Ultrasector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Real Estate Ultrasector 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 Real Estate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Real Estate Ultrasector has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Real Estate go up and down completely randomly.

Pair Corralation between Walker Dunlop and Real Estate

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.57 times more return on investment than Real Estate. However, Walker Dunlop is 1.57 times more volatile than Real Estate Ultrasector. It trades about 0.04 of its potential returns per unit of risk. Real Estate Ultrasector is currently generating about 0.04 per unit of risk. If you would invest  7,191  in Walker Dunlop on May 3, 2025 and sell it today you would earn a total of  310.00  from holding Walker Dunlop or generate 4.31% return on investment over 90 days.

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

Walker Dunlop  vs.  Real Estate Ultrasector

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.

Real Estate Ultrasector

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Real Estate Ultrasector are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Real Estate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Walker Dunlop and Real Estate

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

The idea behind Walker Dunlop and Real Estate Ultrasector 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 Commodity Directory module to find actively traded commodities issued by global exchanges.