Correlation Between Anywhere Real and Rafael Holdings

Can any of the company-specific risk be diversified away by investing in both Anywhere Real and Rafael Holdings 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 Anywhere Real and Rafael Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Anywhere Real Estate and Rafael Holdings Class, you can compare the effects of market volatilities on Anywhere Real and Rafael Holdings 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 Anywhere Real with a short position of Rafael Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anywhere Real and Rafael Holdings.

Diversification Opportunities for Anywhere Real and Rafael Holdings

0.41

Correlation Coefficient

Anywhere Real  Rafael Holdings

Very weak diversification

The 3 months correlation between Anywhere and Rafael is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Anywhere Real Estate and Rafael Holdings Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rafael Holdings Class and Anywhere Real 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 Anywhere Real Estate are associated (or correlated) with Rafael Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rafael Holdings Class has no effect on the direction of Anywhere Real i.e., Anywhere Real and Rafael Holdings go up and down completely randomly.

Pair Corralation between Anywhere Real and Rafael Holdings

Given the investment horizon of 90 days Anywhere Real Estate is expected to generate 1.22 times more return on investment than Rafael Holdings. However, Anywhere Real is 1.22 times more volatile than Rafael Holdings Class. It trades about 0.05 of its potential returns per unit of risk. Rafael Holdings Class is currently generating about 0.06 per unit of risk. If you would invest  336.00  in Anywhere Real Estate on December 29, 2024 and sell it today you would earn a total of  28.00  from holding Anywhere Real Estate or generate 8.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Anywhere Real Estate  vs.  Rafael Holdings Class

Anywhere Real Estate

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Anywhere Real Estate are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Anywhere Real unveiled solid returns over the last few months and may actually be approaching a breakup point.

Rafael Holdings Class

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Rafael Holdings Class are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating technical and fundamental indicators, Rafael Holdings disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Anywhere Real and Rafael Holdings

The main advantage of trading using opposite Anywhere Real and Rafael Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anywhere Real position performs unexpectedly, Rafael Holdings 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 Rafael Holdings will offset losses from the drop in Rafael Holdings' long position.

The idea behind Anywhere Real Estate and Rafael Holdings Class 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.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.