Correlation Between Tradeweb Markets and SK Growth

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

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

Diversification Opportunities for Tradeweb Markets and SK Growth

-0.45

Correlation Coefficient

Tradeweb Markets  SK Growth

Very good diversification

The 3 months correlation between Tradeweb and SKGR is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Tradeweb Markets and SK Growth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Growth Opportunities 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 SK Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Growth Opportunities has no effect on the direction of Tradeweb Markets i.e., Tradeweb Markets and SK Growth go up and down completely randomly.

Pair Corralation between Tradeweb Markets and SK Growth

Allowing for the 90-day total investment horizon Tradeweb Markets is expected to generate 19.88 times less return on investment than SK Growth. In addition to that, Tradeweb Markets is 10.39 times more volatile than SK Growth Opportunities. It trades about 0.0 of its total potential returns per unit of risk. SK Growth Opportunities is currently generating about 0.11 per unit of volatility. If you would invest  1,154  in SK Growth Opportunities on December 4, 2024 and sell it today you would earn a total of  11.00  from holding SK Growth Opportunities or generate 0.95% return on investment over 90 days.

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

Tradeweb Markets  vs.  SK Growth Opportunities

Tradeweb Markets

Risk-Adjusted Performance

Weak

Over the last 90 days Tradeweb Markets has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Tradeweb Markets is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

SK Growth Opportunities

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SK Growth Opportunities are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable technical and fundamental indicators, SK Growth is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Tradeweb Markets and SK Growth

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

The idea behind Tradeweb Markets and SK Growth Opportunities 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.