Correlation Between Jones Lang and Modiv
Can any of the company-specific risk be diversified away by investing in both Jones Lang and Modiv 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 Jones Lang and Modiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jones Lang LaSalle and Modiv Inc, you can compare the effects of market volatilities on Jones Lang and Modiv 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 Jones Lang with a short position of Modiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jones Lang and Modiv.
Diversification Opportunities for Jones Lang and Modiv
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jones and Modiv is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Jones Lang LaSalle and Modiv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Modiv Inc and Jones Lang 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 Jones Lang LaSalle are associated (or correlated) with Modiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Modiv Inc has no effect on the direction of Jones Lang i.e., Jones Lang and Modiv go up and down completely randomly.
Pair Corralation between Jones Lang and Modiv
Considering the 90-day investment horizon Jones Lang LaSalle is expected to generate 0.83 times more return on investment than Modiv. However, Jones Lang LaSalle is 1.2 times less risky than Modiv. It trades about 0.09 of its potential returns per unit of risk. Modiv Inc is currently generating about 0.04 per unit of risk. If you would invest 14,400 in Jones Lang LaSalle on August 27, 2024 and sell it today you would earn a total of 11,927 from holding Jones Lang LaSalle or generate 82.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jones Lang LaSalle vs. Modiv Inc
Performance |
| Timeline |
| Jones Lang LaSalle |
| Modiv Inc |
Jones Lang and Modiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jones Lang and Modiv
The main advantage of trading using opposite Jones Lang and Modiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jones Lang position performs unexpectedly, Modiv 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 Modiv will offset losses from the drop in Modiv's long position.| Jones Lang vs. Cushman Wakefield plc | Jones Lang vs. Colliers International Group | Jones Lang vs. CoStar Group | Jones Lang vs. Newmark Group |
| Modiv vs. Investcorp Credit Management | Modiv vs. Medalist Diversified Reit | Modiv vs. Aquagold International | Modiv 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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