Correlation Between EXp World and FirstService Corp

Can any of the company-specific risk be diversified away by investing in both EXp World and FirstService Corp 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 FirstService Corp 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 FirstService Corp, you can compare the effects of market volatilities on EXp World and FirstService Corp 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 FirstService Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of EXp World and FirstService Corp.

Diversification Opportunities for EXp World and FirstService Corp

0.67

Correlation Coefficient

EXp World  FirstService Corp

Poor diversification

The 3 months correlation between EXp and FirstService is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding eXp World Holdings and FirstService Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FirstService Corp 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 FirstService Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FirstService Corp has no effect on the direction of EXp World i.e., EXp World and FirstService Corp go up and down completely randomly.

Pair Corralation between EXp World and FirstService Corp

Given the investment horizon of 90 days eXp World Holdings is expected to generate 2.28 times more return on investment than FirstService Corp. However, EXp World is 2.28 times more volatile than FirstService Corp. It trades about 0.13 of its potential returns per unit of risk. FirstService Corp is currently generating about 0.13 per unit of risk. If you would invest  777.00  in eXp World Holdings on May 11, 2025 and sell it today you would earn a total of  219.00  from holding eXp World Holdings or generate 28.19% return on investment over 90 days.

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

eXp World Holdings  vs.  FirstService Corp

eXp World Holdings

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in eXp World Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, EXp World demonstrated solid returns over the last few months and may actually be approaching a breakup point.

FirstService Corp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in FirstService Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, FirstService Corp may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with EXp World and FirstService Corp

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

The idea behind eXp World Holdings and FirstService Corp 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.