Correlation Between Tradeweb Markets and Materialise

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

By analyzing existing cross correlation between Tradeweb Markets and Materialise NV, you can compare the effects of market volatilities on Tradeweb Markets and Materialise 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 Materialise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tradeweb Markets and Materialise.

Diversification Opportunities for Tradeweb Markets and Materialise

-0.36

Correlation Coefficient

Tradeweb Markets  Materialise

Very good diversification

The 3 months correlation between Tradeweb and Materialise is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Tradeweb Markets and Materialise NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materialise NV 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 Materialise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materialise NV has no effect on the direction of Tradeweb Markets i.e., Tradeweb Markets and Materialise go up and down completely randomly.

Pair Corralation between Tradeweb Markets and Materialise

Assuming the 90 days horizon Tradeweb Markets is expected to generate 0.32 times more return on investment than Materialise. However, Tradeweb Markets is 3.11 times less risky than Materialise. It trades about 0.02 of its potential returns per unit of risk. Materialise NV is currently generating about -0.08 per unit of risk. If you would invest  12,988  in Tradeweb Markets on December 26, 2024 and sell it today you would earn a total of  212.00  from holding Tradeweb Markets or generate 1.63% return on investment over 90 days.

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

Tradeweb Markets  vs.  Materialise NV

Tradeweb Markets

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Tradeweb Markets are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Tradeweb Markets is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Materialise NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Materialise NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Tradeweb Markets and Materialise

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

The idea behind Tradeweb Markets and Materialise NV 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.

Check out your portfolio center.

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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.