Correlation Between MarketAxess Holdings and Greenhill
Can any of the company-specific risk be diversified away by investing in both MarketAxess Holdings and Greenhill 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 MarketAxess Holdings and Greenhill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MarketAxess Holdings and Greenhill Co, you can compare the effects of market volatilities on MarketAxess Holdings and Greenhill 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 MarketAxess Holdings with a short position of Greenhill. Check out your portfolio center. Please also check ongoing floating volatility patterns of MarketAxess Holdings and Greenhill.
Diversification Opportunities for MarketAxess Holdings and Greenhill
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MarketAxess and Greenhill is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding MarketAxess Holdings and Greenhill Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenhill and MarketAxess Holdings 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 MarketAxess Holdings are associated (or correlated) with Greenhill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenhill has no effect on the direction of MarketAxess Holdings i.e., MarketAxess Holdings and Greenhill go up and down completely randomly.
Pair Corralation between MarketAxess Holdings and Greenhill
Given the investment horizon of 90 days MarketAxess Holdings is expected to generate 47.59 times less return on investment than Greenhill. But when comparing it to its historical volatility, MarketAxess Holdings is 4.38 times less risky than Greenhill. It trades about 0.01 of its potential returns per unit of risk. Greenhill Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 952.00 in Greenhill Co on August 25, 2024 and sell it today you would earn a total of 521.00 from holding Greenhill Co or generate 54.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 31.99% |
| Values | Daily Returns |
MarketAxess Holdings vs. Greenhill Co
Performance |
| Timeline |
| MarketAxess Holdings |
| Greenhill |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MarketAxess Holdings and Greenhill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MarketAxess Holdings and Greenhill
The main advantage of trading using opposite MarketAxess Holdings and Greenhill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MarketAxess Holdings position performs unexpectedly, Greenhill 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 Greenhill will offset losses from the drop in Greenhill's long position.| MarketAxess Holdings vs. Interactive Brokers Group | MarketAxess Holdings vs. Evercore Partners | MarketAxess Holdings vs. PJT Partners | MarketAxess Holdings vs. LPL Financial Holdings |
| Greenhill vs. Magic Empire Global | Greenhill vs. Applied Blockchain | Greenhill vs. Zhong Yang Financial | Greenhill vs. Netcapital |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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