Correlation Between Douglas Elliman and Gladstone Land
Can any of the company-specific risk be diversified away by investing in both Douglas Elliman and Gladstone Land 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 Douglas Elliman and Gladstone Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Douglas Elliman and Gladstone Land Corp, you can compare the effects of market volatilities on Douglas Elliman and Gladstone Land 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 Douglas Elliman with a short position of Gladstone Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Douglas Elliman and Gladstone Land.
Diversification Opportunities for Douglas Elliman and Gladstone Land
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Douglas and Gladstone is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Douglas Elliman and Gladstone Land Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Land Corp and Douglas Elliman 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 Douglas Elliman are associated (or correlated) with Gladstone Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Land Corp has no effect on the direction of Douglas Elliman i.e., Douglas Elliman and Gladstone Land go up and down completely randomly.
Pair Corralation between Douglas Elliman and Gladstone Land
Given the investment horizon of 90 days Douglas Elliman is expected to generate 2.32 times more return on investment than Gladstone Land. However, Douglas Elliman is 2.32 times more volatile than Gladstone Land Corp. It trades about 0.37 of its potential returns per unit of risk. Gladstone Land Corp is currently generating about -0.03 per unit of risk. If you would invest 158.00 in Douglas Elliman on November 9, 2024 and sell it today you would earn a total of 39.00 from holding Douglas Elliman or generate 24.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Douglas Elliman vs. Gladstone Land Corp
Performance |
| Timeline |
| Douglas Elliman |
| Gladstone Land Corp |
Douglas Elliman and Gladstone Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Douglas Elliman and Gladstone Land
The main advantage of trading using opposite Douglas Elliman and Gladstone Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Douglas Elliman position performs unexpectedly, Gladstone Land 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 Gladstone Land will offset losses from the drop in Gladstone Land's long position.| Douglas Elliman vs. Frp Holdings Ord | Douglas Elliman vs. Marcus Millichap | Douglas Elliman vs. Transcontinental Realty Investors | Douglas Elliman vs. Fathom Holdings |
| Gladstone Land vs. Gladstone Land Corp | Gladstone Land vs. Gladstone Commercial Corp | Gladstone Land vs. AGNC Investment Corp | Gladstone Land vs. AGNC Investment Corp |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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