Correlation Between Perella Weinberg and Stonex

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

By analyzing existing cross correlation between Perella Weinberg Partners and Stonex Group, you can compare the effects of market volatilities on Perella Weinberg and Stonex 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 Perella Weinberg with a short position of Stonex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perella Weinberg and Stonex.

Diversification Opportunities for Perella Weinberg and Stonex

-0.21

Correlation Coefficient

Perella Weinberg  Stonex

Very good diversification

The 3 months correlation between Perella and Stonex is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Perella Weinberg Partners and Stonex Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stonex Group and Perella Weinberg 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 Perella Weinberg Partners are associated (or correlated) with Stonex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stonex Group has no effect on the direction of Perella Weinberg i.e., Perella Weinberg and Stonex go up and down completely randomly.

Pair Corralation between Perella Weinberg and Stonex

Considering the 90-day investment horizon Perella Weinberg Partners is expected to under-perform the Stonex. In addition to that, Perella Weinberg is 1.23 times more volatile than Stonex Group. It trades about -0.12 of its total potential returns per unit of risk. Stonex Group is currently generating about 0.11 per unit of volatility. If you would invest  6,544  in Stonex Group on December 28, 2024 and sell it today you would earn a total of  1,068  from holding Stonex Group or generate 16.32% return on investment over 90 days.

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

Perella Weinberg Partners  vs.  Stonex Group

Perella Weinberg Partners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Perella Weinberg Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Stonex Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Stonex Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, Stonex showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Perella Weinberg and Stonex

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

The idea behind Perella Weinberg Partners and Stonex Group 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.