Correlation Between CBRE Group and Marcus Millichap
Can any of the company-specific risk be diversified away by investing in both CBRE Group and Marcus Millichap 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 CBRE Group and Marcus Millichap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBRE Group Class and Marcus Millichap, you can compare the effects of market volatilities on CBRE Group and Marcus Millichap 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 CBRE Group with a short position of Marcus Millichap. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBRE Group and Marcus Millichap.
Diversification Opportunities for CBRE Group and Marcus Millichap
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CBRE and Marcus is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding CBRE Group Class and Marcus Millichap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marcus Millichap and CBRE Group 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 CBRE Group Class are associated (or correlated) with Marcus Millichap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marcus Millichap has no effect on the direction of CBRE Group i.e., CBRE Group and Marcus Millichap go up and down completely randomly.
Pair Corralation between CBRE Group and Marcus Millichap
Given the investment horizon of 90 days CBRE Group Class is expected to generate 0.89 times more return on investment than Marcus Millichap. However, CBRE Group Class is 1.12 times less risky than Marcus Millichap. It trades about 0.1 of its potential returns per unit of risk. Marcus Millichap is currently generating about 0.06 per unit of risk. If you would invest 7,605 in CBRE Group Class on August 27, 2024 and sell it today you would earn a total of 5,938 from holding CBRE Group Class or generate 78.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CBRE Group Class vs. Marcus Millichap
Performance |
| Timeline |
| CBRE Group Class |
| Marcus Millichap |
CBRE Group and Marcus Millichap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBRE Group and Marcus Millichap
The main advantage of trading using opposite CBRE Group and Marcus Millichap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBRE Group position performs unexpectedly, Marcus Millichap 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 Marcus Millichap will offset losses from the drop in Marcus Millichap's long position.| CBRE Group vs. Cushman Wakefield plc | CBRE Group vs. Newmark Group | CBRE Group vs. Colliers International Group | CBRE Group vs. Marcus Millichap |
| Marcus Millichap vs. Investcorp Credit Management | Marcus Millichap vs. Medalist Diversified Reit | Marcus Millichap vs. Aquagold International | Marcus Millichap vs. Morningstar Unconstrained Allocation |
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 the Money Managers module to screen money managers from public funds and ETFs managed around the world.
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