Correlation Between Intel Corp and Walmart

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Can any of the company-specific risk be diversified away by investing in both Intel Corp and Walmart 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 Intel Corp and Walmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel Corp and Walmart, you can compare the effects of market volatilities on Intel Corp and Walmart 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 Intel Corp with a short position of Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel Corp and Walmart.

Diversification Opportunities for Intel Corp and Walmart

0.29
  Correlation Coefficient

Modest diversification

The 3 months correlation between Intel and Walmart is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Intel Corp and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart and Intel Corp 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 Intel Corp are associated (or correlated) with Walmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walmart has no effect on the direction of Intel Corp i.e., Intel Corp and Walmart go up and down completely randomly.

Pair Corralation between Intel Corp and Walmart

Given the investment horizon of 90 days Intel Corp is expected to under-perform the Walmart. In addition to that, Intel Corp is 1.21 times more volatile than Walmart. It trades about -0.05 of its total potential returns per unit of risk. Walmart is currently generating about 0.15 per unit of volatility. If you would invest  11,886  in Walmart on May 16, 2022 and sell it today you would earn a total of  1,336  from holding Walmart or generate 11.24% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy97.67%
ValuesDaily Returns

Intel Corp  vs.  Walmart

 Performance (%) 
       Timeline  
Intel Corp 
Intel Performance
0 of 100
Over the last 90 days Intel Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite sluggish performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in September 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Intel Price Channel

Walmart 
Walmart Performance
0 of 100
Over the last 90 days Walmart has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's primary indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Walmart Price Channel

Intel Corp and Walmart Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Intel Corp and Walmart

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

Intel Corp

Pair trading matchups for Intel Corp

The idea behind Intel Corp and Walmart 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.
Check out your portfolio center. 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.

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