Correlation Between CoStar and J W
Can any of the company-specific risk be diversified away by investing in both CoStar and J W 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 CoStar and J W into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CoStar Group and J W Mays, you can compare the effects of market volatilities on CoStar and J W 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 CoStar with a short position of J W. Check out your portfolio center. Please also check ongoing floating volatility patterns of CoStar and J W.
Diversification Opportunities for CoStar and J W
Very good diversification
The 3 months correlation between CoStar and MAYS is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding CoStar Group and J W Mays in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J W Mays and CoStar 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 CoStar Group are associated (or correlated) with J W. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J W Mays has no effect on the direction of CoStar i.e., CoStar and J W go up and down completely randomly.
Pair Corralation between CoStar and J W
Given the investment horizon of 90 days CoStar Group is expected to generate 1.9 times more return on investment than J W. However, CoStar is 1.9 times more volatile than J W Mays. It trades about 0.13 of its potential returns per unit of risk. J W Mays is currently generating about -0.38 per unit of risk. If you would invest 7,282 in CoStar Group on August 24, 2024 and sell it today you would earn a total of 418.00 from holding CoStar Group or generate 5.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 47.83% |
| Values | Daily Returns |
CoStar Group vs. J W Mays
Performance |
| Timeline |
| CoStar Group |
| J W Mays |
CoStar and J W Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CoStar and J W
The main advantage of trading using opposite CoStar and J W positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CoStar position performs unexpectedly, J W 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 J W will offset losses from the drop in J W's long position.| CoStar vs. Jones Lang LaSalle | CoStar vs. Cushman Wakefield plc | CoStar vs. Colliers International Group | CoStar vs. Newmark Group |
| J W vs. New England Realty | J W vs. Marcus Millichap | J W vs. FirstService Corp | J W vs. Maui Land Pineapple |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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