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The Housing & Stock Market Relationship

The Housing & Stock Market Relationship. Aseem Sharma , Calvin Kai, Nadine Lazzara , & Shaima Abdalla. Introduction . The Relationship. Have stock prices and real estate prices moved in unison historically?

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The Housing & Stock Market Relationship

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  1. The Housing & Stock Market Relationship Aseem Sharma , Calvin Kai, Nadine Lazzara , & ShaimaAbdalla

  2. Introduction

  3. The Relationship Have stock prices and real estate prices moved in unison historically? National Association of Home Builders (NAHB) Housing Market Index (HMI) vs. S&P 500 Index The NAHB Housing Market Index behaved as the leading indicator for the S&P 500 Index by 12-15 months with an 80+% correlation between 1998 and 2005.

  4. The Relationship CXO Advisory study conducted using annual median home price data and comparing it to the S&P 500 Index Low correlation ranging from -0.30 to 0.12 In the past 43 years there was no contemporaneous relationship established

  5. Sweet Suburban Dream

  6. Lend me more - Subprime Mortgage

  7. Shake in the Finance Market

  8. The Black Week

  9. Global Relationship S&P Europe 350 France England Portugal

  10. Global Relationship Hong Kong Japan China S&P Asia 50

  11. US Housing Market Outlook • Is the housing market starting to bottom out? Or is it declining further? • Justification for market turnaround: • Fourth consecutive month rise of the S&P/Case-Shiller 20-city home price index. • Increase in home sales. • Justification for a further decline

  12. Vanguard Health Care (VHT) Conservative Expected Return: 3.27%

  13. Conclusion • Over the last decade, the two markets have had a positive correlation • When approaching the issue over a longer period, research doesn’t indicate any definite correlation • Presence of several other factors that effectively influence the two markets

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