Correlation Between Tradeweb Markets and EVe Mobility

Can any of the company-specific risk be diversified away by investing in both Tradeweb Markets and EVe Mobility 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 Tradeweb Markets and EVe Mobility into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tradeweb Markets and EVe Mobility Acquisition, you can compare the effects of market volatilities on Tradeweb Markets and EVe Mobility 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 Tradeweb Markets with a short position of EVe Mobility. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tradeweb Markets and EVe Mobility.

Diversification Opportunities for Tradeweb Markets and EVe Mobility

0.74

Correlation Coefficient

Tradeweb Markets  EVe Mobility

Poor diversification

The 3 months correlation between Tradeweb and EVe is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Tradeweb Markets and EVe Mobility Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVe Mobility Acquisition and Tradeweb Markets 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 Tradeweb Markets are associated (or correlated) with EVe Mobility. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVe Mobility Acquisition has no effect on the direction of Tradeweb Markets i.e., Tradeweb Markets and EVe Mobility go up and down completely randomly.

Pair Corralation between Tradeweb Markets and EVe Mobility

Allowing for the 90-day total investment horizon Tradeweb Markets is expected to generate 6.49 times more return on investment than EVe Mobility. However, Tradeweb Markets is 6.49 times more volatile than EVe Mobility Acquisition. It trades about 0.08 of its potential returns per unit of risk. EVe Mobility Acquisition is currently generating about -0.06 per unit of risk. If you would invest  12,886  in Tradeweb Markets on September 13, 2024 and sell it today you would earn a total of  313.50  from holding Tradeweb Markets or generate 2.43% return on investment over 90 days.

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

Tradeweb Markets  vs.  EVe Mobility Acquisition

Tradeweb Markets

Risk-Adjusted Performance

10 of 100

OK

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

EVe Mobility Acquisition

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in EVe Mobility Acquisition are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, EVe Mobility is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Tradeweb Markets and EVe Mobility

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

The idea behind Tradeweb Markets and EVe Mobility Acquisition 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.