Correlation Between EXp World and Cushman Wakefield
Can any of the company-specific risk be diversified away by investing in both EXp World and Cushman Wakefield 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 EXp World and Cushman Wakefield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eXp World Holdings and Cushman Wakefield plc, you can compare the effects of market volatilities on EXp World and Cushman Wakefield 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 EXp World with a short position of Cushman Wakefield. Check out your portfolio center. Please also check ongoing floating volatility patterns of EXp World and Cushman Wakefield.
Diversification Opportunities for EXp World and Cushman Wakefield
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EXp and Cushman is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding eXp World Holdings and Cushman Wakefield plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cushman Wakefield plc and EXp World 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 eXp World Holdings are associated (or correlated) with Cushman Wakefield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cushman Wakefield plc has no effect on the direction of EXp World i.e., EXp World and Cushman Wakefield go up and down completely randomly.
Pair Corralation between EXp World and Cushman Wakefield
Given the investment horizon of 90 days EXp World is expected to generate 1.25 times less return on investment than Cushman Wakefield. In addition to that, EXp World is 1.23 times more volatile than Cushman Wakefield plc. It trades about 0.08 of its total potential returns per unit of risk. Cushman Wakefield plc is currently generating about 0.12 per unit of volatility. If you would invest 1,076 in Cushman Wakefield plc on September 1, 2024 and sell it today you would earn a total of 454.00 from holding Cushman Wakefield plc or generate 42.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
eXp World Holdings vs. Cushman Wakefield plc
Performance |
| Timeline |
| eXp World Holdings |
| Cushman Wakefield plc |
EXp World and Cushman Wakefield Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EXp World and Cushman Wakefield
The main advantage of trading using opposite EXp World and Cushman Wakefield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EXp World position performs unexpectedly, Cushman Wakefield 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 Cushman Wakefield will offset losses from the drop in Cushman Wakefield's long position.| EXp World vs. Re Max Holding | EXp World vs. Fathom Holdings | EXp World vs. Anywhere Real Estate | EXp World vs. RMR Group |
| Cushman Wakefield vs. Re Max Holding | Cushman Wakefield vs. Marcus Millichap | Cushman Wakefield vs. Frp Holdings Ord | Cushman Wakefield 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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