Correlation Between Mr Cooper and Home Point
Can any of the company-specific risk be diversified away by investing in both Mr Cooper and Home Point 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 Mr Cooper and Home Point into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mr Cooper Group and Home Point Capital, you can compare the effects of market volatilities on Mr Cooper and Home Point 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 Mr Cooper with a short position of Home Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mr Cooper and Home Point.
Diversification Opportunities for Mr Cooper and Home Point
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between COOP and Home is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Mr Cooper Group and Home Point Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Point Capital and Mr Cooper 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 Mr Cooper Group are associated (or correlated) with Home Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Point Capital has no effect on the direction of Mr Cooper i.e., Mr Cooper and Home Point go up and down completely randomly.
Pair Corralation between Mr Cooper and Home Point
If you would invest 5,969 in Mr Cooper Group on August 24, 2024 and sell it today you would earn a total of 3,864 from holding Mr Cooper Group or generate 64.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.4% |
| Values | Daily Returns |
Mr Cooper Group vs. Home Point Capital
Performance |
| Timeline |
| Mr Cooper Group |
| Home Point Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Mr Cooper and Home Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mr Cooper and Home Point
The main advantage of trading using opposite Mr Cooper and Home Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mr Cooper position performs unexpectedly, Home Point 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 Home Point will offset losses from the drop in Home Point's long position.| Mr Cooper vs. Guild Holdings Co | Mr Cooper vs. Encore Capital Group | Mr Cooper vs. CNFinance Holdings | Mr Cooper vs. Velocity Financial Llc |
| Home Point vs. CNFinance Holdings | Home Point vs. Security National Financial | Home Point vs. Encore Capital Group | Home Point vs. Guild Holdings Co |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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