Correlation Between Re Max and Newmark
Can any of the company-specific risk be diversified away by investing in both Re Max and Newmark 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 Re Max and Newmark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Re Max Holding and Newmark Group, you can compare the effects of market volatilities on Re Max and Newmark 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 Re Max with a short position of Newmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Re Max and Newmark.
Diversification Opportunities for Re Max and Newmark
Very poor diversification
The 3 months correlation between RMAX and Newmark is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Re Max Holding and Newmark Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newmark Group and Re Max 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 Re Max Holding are associated (or correlated) with Newmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newmark Group has no effect on the direction of Re Max i.e., Re Max and Newmark go up and down completely randomly.
Pair Corralation between Re Max and Newmark
Given the investment horizon of 90 days Re Max Holding is expected to under-perform the Newmark. In addition to that, Re Max is 1.69 times more volatile than Newmark Group. It trades about -0.01 of its total potential returns per unit of risk. Newmark Group is currently generating about 0.02 per unit of volatility. If you would invest 1,376 in Newmark Group on November 2, 2024 and sell it today you would earn a total of 33.00 from holding Newmark Group or generate 2.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Re Max Holding vs. Newmark Group
Performance |
| Timeline |
| Re Max Holding |
| Newmark Group |
Re Max and Newmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Re Max and Newmark
The main advantage of trading using opposite Re Max and Newmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Re Max position performs unexpectedly, Newmark 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 Newmark will offset losses from the drop in Newmark's long position.| Re Max vs. Marcus Millichap | Re Max vs. Frp Holdings Ord | Re Max vs. Maui Land Pineapple | Re Max vs. Transcontinental Realty Investors |
| Newmark vs. Jones Lang LaSalle | Newmark vs. CBRE Group Class | Newmark vs. Colliers International Group | Newmark vs. Marcus Millichap |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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