Correlation Between Perella Weinberg and WinVest Acquisition

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

Diversification Opportunities for Perella Weinberg and WinVest Acquisition

-0.35

Correlation Coefficient

Perella Weinberg  WinVest Acquisition

Very good diversification

The 3 months correlation between Perella and WinVest is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Perella Weinberg Partners and WinVest Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WinVest Acquisition Corp 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 WinVest Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WinVest Acquisition Corp has no effect on the direction of Perella Weinberg i.e., Perella Weinberg and WinVest Acquisition go up and down completely randomly.

Pair Corralation between Perella Weinberg and WinVest Acquisition

Considering the 90-day investment horizon Perella Weinberg is expected to generate 209.94 times less return on investment than WinVest Acquisition. But when comparing it to its historical volatility, Perella Weinberg Partners is 88.41 times less risky than WinVest Acquisition. It trades about 0.09 of its potential returns per unit of risk. WinVest Acquisition Corp is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  3.00  in WinVest Acquisition Corp on October 27, 2024 and sell it today you would lose (1.24) from holding WinVest Acquisition Corp or give up 41.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	31.78%
Values	Daily Returns

Perella Weinberg Partners  vs.  WinVest Acquisition Corp

Perella Weinberg Partners

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Perella Weinberg Partners are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Perella Weinberg reported solid returns over the last few months and may actually be approaching a breakup point.

WinVest Acquisition Corp

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days WinVest Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly abnormal basic indicators, WinVest Acquisition showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Perella Weinberg and WinVest Acquisition

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

The idea behind Perella Weinberg Partners and WinVest Acquisition 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.