Correlation Between AM EAGLE and Tradeweb Markets
Can any of the company-specific risk be diversified away by investing in both AM EAGLE and Tradeweb Markets 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 AM EAGLE and Tradeweb Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AM EAGLE OUTFITTERS and Tradeweb Markets, you can compare the effects of market volatilities on AM EAGLE and Tradeweb Markets 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 AM EAGLE with a short position of Tradeweb Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of AM EAGLE and Tradeweb Markets.
Diversification Opportunities for AM EAGLE and Tradeweb Markets
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AFG and Tradeweb is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding AM EAGLE OUTFITTERS and Tradeweb Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tradeweb Markets and AM EAGLE 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 AM EAGLE OUTFITTERS are associated (or correlated) with Tradeweb Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tradeweb Markets has no effect on the direction of AM EAGLE i.e., AM EAGLE and Tradeweb Markets go up and down completely randomly.
Pair Corralation between AM EAGLE and Tradeweb Markets
Assuming the 90 days trading horizon AM EAGLE is expected to generate 1.32 times less return on investment than Tradeweb Markets. In addition to that, AM EAGLE is 1.76 times more volatile than Tradeweb Markets. It trades about 0.06 of its total potential returns per unit of risk. Tradeweb Markets is currently generating about 0.13 per unit of volatility. If you would invest 6,312 in Tradeweb Markets on October 16, 2024 and sell it today you would earn a total of 6,488 from holding Tradeweb Markets or generate 102.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AM EAGLE OUTFITTERS vs. Tradeweb Markets
Performance |
| Timeline |
| AM EAGLE OUTFITTERS |
| Tradeweb Markets |
AM EAGLE and Tradeweb Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AM EAGLE and Tradeweb Markets
The main advantage of trading using opposite AM EAGLE and Tradeweb Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AM EAGLE position performs unexpectedly, Tradeweb Markets 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 Tradeweb Markets will offset losses from the drop in Tradeweb Markets' long position.| AM EAGLE vs. CarsalesCom | AM EAGLE vs. Tsingtao Brewery | AM EAGLE vs. Grupo Carso SAB | AM EAGLE vs. MOLSON RS BEVERAGE |
| Tradeweb Markets vs. IMPERIAL TOBACCO | Tradeweb Markets vs. G III Apparel Group | Tradeweb Markets vs. AM EAGLE OUTFITTERS | Tradeweb Markets vs. BRIT AMER TOBACCO |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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