Correlation Between Jones Lang and Cushman Wakefield

Can any of the company-specific risk be diversified away by investing in both Jones Lang and Cushman Wakefield 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 Jones Lang and Cushman Wakefield into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jones Lang LaSalle and Cushman Wakefield plc, you can compare the effects of market volatilities on Jones Lang and Cushman Wakefield 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 Jones Lang with a short position of Cushman Wakefield. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jones Lang and Cushman Wakefield.

Diversification Opportunities for Jones Lang and Cushman Wakefield

0.51

Correlation Coefficient

Jones Lang  Cushman Wakefield

Very weak diversification

The 3 months correlation between Jones and Cushman is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Jones Lang LaSalle and Cushman Wakefield plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cushman Wakefield plc and Jones Lang 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 Jones Lang LaSalle are associated (or correlated) with Cushman Wakefield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cushman Wakefield plc has no effect on the direction of Jones Lang i.e., Jones Lang and Cushman Wakefield go up and down completely randomly.

Pair Corralation between Jones Lang and Cushman Wakefield

Considering the 90-day investment horizon Jones Lang LaSalle is expected to generate 0.93 times more return on investment than Cushman Wakefield. However, Jones Lang LaSalle is 1.08 times less risky than Cushman Wakefield. It trades about 0.02 of its potential returns per unit of risk. Cushman Wakefield plc is currently generating about -0.14 per unit of risk. If you would invest  25,218  in Jones Lang LaSalle on December 28, 2024 and sell it today you would earn a total of  225.00  from holding Jones Lang LaSalle or generate 0.89% return on investment over 90 days.

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

Jones Lang LaSalle  vs.  Cushman Wakefield plc

Jones Lang LaSalle

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jones Lang LaSalle are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent essential indicators, Jones Lang is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Cushman Wakefield plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cushman Wakefield plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Jones Lang and Cushman Wakefield

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

The idea behind Jones Lang LaSalle and Cushman Wakefield plc 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.