Correlation Between Opendoor Technologies and EXp World

Can any of the company-specific risk be diversified away by investing in both Opendoor Technologies and EXp World 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 Opendoor Technologies and EXp World into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Opendoor Technologies and eXp World Holdings, you can compare the effects of market volatilities on Opendoor Technologies and EXp World 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 Opendoor Technologies with a short position of EXp World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Opendoor Technologies and EXp World.

Diversification Opportunities for Opendoor Technologies and EXp World

0.91

Correlation Coefficient

Opendoor Technologies  EXp World

Almost no diversification

The 3 months correlation between Opendoor and EXp is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Opendoor Technologies and eXp World Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eXp World Holdings and Opendoor Technologies 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 Opendoor Technologies are associated (or correlated) with EXp World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eXp World Holdings has no effect on the direction of Opendoor Technologies i.e., Opendoor Technologies and EXp World go up and down completely randomly.

Pair Corralation between Opendoor Technologies and EXp World

Given the investment horizon of 90 days Opendoor Technologies is expected to under-perform the EXp World. In addition to that, Opendoor Technologies is 1.32 times more volatile than eXp World Holdings. It trades about -0.18 of its total potential returns per unit of risk. eXp World Holdings is currently generating about -0.14 per unit of volatility. If you would invest  1,385  in eXp World Holdings on November 28, 2024 and sell it today you would lose (335.00) from holding eXp World Holdings or give up 24.19% of portfolio value over 90 days.

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

Opendoor Technologies  vs.  eXp World Holdings

Opendoor Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Opendoor Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in March 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

eXp World Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days eXp World Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in March 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Opendoor Technologies and EXp World

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

The idea behind Opendoor Technologies and eXp World Holdings 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.