Correlation Between EXp World and CoStar
Can any of the company-specific risk be diversified away by investing in both EXp World and CoStar 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 EXp World and CoStar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eXp World Holdings and CoStar Group, you can compare the effects of market volatilities on EXp World and CoStar 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 EXp World with a short position of CoStar. Check out your portfolio center. Please also check ongoing floating volatility patterns of EXp World and CoStar.
Diversification Opportunities for EXp World and CoStar
Excellent diversification
The 3 months correlation between EXp and CoStar is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding eXp World Holdings and CoStar Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoStar Group and EXp World 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 eXp World Holdings are associated (or correlated) with CoStar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoStar Group has no effect on the direction of EXp World i.e., EXp World and CoStar go up and down completely randomly.
Pair Corralation between EXp World and CoStar
Given the investment horizon of 90 days eXp World Holdings is expected to under-perform the CoStar. In addition to that, EXp World is 2.08 times more volatile than CoStar Group. It trades about -0.05 of its total potential returns per unit of risk. CoStar Group is currently generating about 0.12 per unit of volatility. If you would invest 7,079 in CoStar Group on January 26, 2024 and sell it today you would earn a total of 2,116 from holding CoStar Group or generate 29.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
eXp World Holdings vs. CoStar Group
Performance |
| Timeline |
| eXp World Holdings |
| CoStar Group |
EXp World and CoStar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EXp World and CoStar
The main advantage of trading using opposite EXp World and CoStar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EXp World position performs unexpectedly, CoStar 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 CoStar will offset losses from the drop in CoStar's long position.The idea behind eXp World Holdings and CoStar 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.| CoStar vs. Jones Lang LaSalle | CoStar vs. Cushman Wakefield plc | CoStar vs. Colliers International Group | CoStar 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |