Correlation Between New York and Rithm Capital
Can any of the company-specific risk be diversified away by investing in both New York and Rithm Capital 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 New York and Rithm Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New York Mortgage and Rithm Capital Corp, you can compare the effects of market volatilities on New York and Rithm Capital 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 New York with a short position of Rithm Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of New York and Rithm Capital.
Diversification Opportunities for New York and Rithm Capital
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between New and Rithm is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding New York Mortgage and Rithm Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rithm Capital Corp and New York 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 New York Mortgage are associated (or correlated) with Rithm Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rithm Capital Corp has no effect on the direction of New York i.e., New York and Rithm Capital go up and down completely randomly.
Pair Corralation between New York and Rithm Capital
Assuming the 90 days horizon New York is expected to generate 1.12 times less return on investment than Rithm Capital. In addition to that, New York is 1.19 times more volatile than Rithm Capital Corp. It trades about 0.08 of its total potential returns per unit of risk. Rithm Capital Corp is currently generating about 0.1 per unit of volatility. If you would invest 1,664 in Rithm Capital Corp on August 30, 2024 and sell it today you would earn a total of 872.00 from holding Rithm Capital Corp or generate 52.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
New York Mortgage vs. Rithm Capital Corp
Performance |
| Timeline |
| New York Mortgage |
| Rithm Capital Corp |
New York and Rithm Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New York and Rithm Capital
The main advantage of trading using opposite New York and Rithm Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New York position performs unexpectedly, Rithm Capital 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 Rithm Capital will offset losses from the drop in Rithm Capital's long position.| New York vs. NexPoint Real Estate | New York vs. TPG RE Finance | New York vs. New York Mortgage | New York vs. New York Mortgage |
| Rithm Capital vs. ACRES Commercial Realty | Rithm Capital vs. Dynex Capital | Rithm Capital vs. PennyMac Mortgage Investment | Rithm Capital vs. AG Mortgage Investment |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |