Correlation Between Newmark and Jones Lang
Can any of the company-specific risk be diversified away by investing in both Newmark and Jones Lang 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 Newmark and Jones Lang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newmark Group and Jones Lang LaSalle, you can compare the effects of market volatilities on Newmark and Jones Lang 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 Newmark with a short position of Jones Lang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newmark and Jones Lang.
Diversification Opportunities for Newmark and Jones Lang
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Newmark and Jones is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Newmark Group and Jones Lang LaSalle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jones Lang LaSalle and Newmark 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 Newmark Group are associated (or correlated) with Jones Lang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jones Lang LaSalle has no effect on the direction of Newmark i.e., Newmark and Jones Lang go up and down completely randomly.
Pair Corralation between Newmark and Jones Lang
Given the investment horizon of 90 days Newmark is expected to generate 1.4 times less return on investment than Jones Lang. But when comparing it to its historical volatility, Newmark Group is 1.54 times less risky than Jones Lang. It trades about 0.09 of its potential returns per unit of risk. Jones Lang LaSalle is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 27,307 in Jones Lang LaSalle on August 27, 2024 and sell it today you would earn a total of 1,060 from holding Jones Lang LaSalle or generate 3.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Newmark Group vs. Jones Lang LaSalle
Performance |
| Timeline |
| Newmark Group |
| Jones Lang LaSalle |
Newmark and Jones Lang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newmark and Jones Lang
The main advantage of trading using opposite Newmark and Jones Lang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newmark position performs unexpectedly, Jones Lang 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 Jones Lang will offset losses from the drop in Jones Lang's long position.| Newmark vs. Jones Lang LaSalle | Newmark vs. CBRE Group Class | Newmark vs. Colliers International Group | Newmark vs. Marcus Millichap |
| Jones Lang vs. Cushman Wakefield plc | Jones Lang vs. Colliers International Group | Jones Lang vs. CoStar Group | Jones Lang vs. Newmark Group |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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