Correlation Between WeWork and Newmark
Can any of the company-specific risk be diversified away by investing in both WeWork 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 WeWork and Newmark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WeWork Inc and Newmark Group, you can compare the effects of market volatilities on WeWork 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 WeWork with a short position of Newmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of WeWork and Newmark.
Diversification Opportunities for WeWork and Newmark
Very good diversification
The 3 months correlation between WeWork and Newmark is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding WeWork Inc and Newmark Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newmark Group and WeWork 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 WeWork Inc 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 WeWork i.e., WeWork and Newmark go up and down completely randomly.
Pair Corralation between WeWork and Newmark
If you would invest 1,006 in Newmark Group on September 1, 2024 and sell it today you would earn a total of 542.00 from holding Newmark Group or generate 53.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.79% |
| Values | Daily Returns |
WeWork Inc vs. Newmark Group
Performance |
| Timeline |
| WeWork Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Newmark Group |
WeWork and Newmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WeWork and Newmark
The main advantage of trading using opposite WeWork and Newmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WeWork 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.The idea behind WeWork Inc and Newmark Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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