Correlation Between CrowdStrike Holdings and Altair Engineering
Can any of the company-specific risk be diversified away by investing in both CrowdStrike Holdings and Altair Engineering 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 CrowdStrike Holdings and Altair Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CrowdStrike Holdings and Altair Engineering, you can compare the effects of market volatilities on CrowdStrike Holdings and Altair Engineering 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 CrowdStrike Holdings with a short position of Altair Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of CrowdStrike Holdings and Altair Engineering.
Diversification Opportunities for CrowdStrike Holdings and Altair Engineering
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CrowdStrike and Altair is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding CrowdStrike Holdings and Altair Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altair Engineering and CrowdStrike 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 CrowdStrike Holdings are associated (or correlated) with Altair Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altair Engineering has no effect on the direction of CrowdStrike Holdings i.e., CrowdStrike Holdings and Altair Engineering go up and down completely randomly.
Pair Corralation between CrowdStrike Holdings and Altair Engineering
Assuming the 90 days horizon CrowdStrike Holdings is expected to generate 1.37 times more return on investment than Altair Engineering. However, CrowdStrike Holdings is 1.37 times more volatile than Altair Engineering. It trades about 0.11 of its potential returns per unit of risk. Altair Engineering is currently generating about 0.09 per unit of risk. If you would invest 9,413 in CrowdStrike Holdings on October 19, 2024 and sell it today you would earn a total of 25,762 from holding CrowdStrike Holdings or generate 273.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CrowdStrike Holdings vs. Altair Engineering
Performance |
| Timeline |
| CrowdStrike Holdings |
| Altair Engineering |
CrowdStrike Holdings and Altair Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CrowdStrike Holdings and Altair Engineering
The main advantage of trading using opposite CrowdStrike Holdings and Altair Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CrowdStrike Holdings position performs unexpectedly, Altair Engineering 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 Altair Engineering will offset losses from the drop in Altair Engineering's long position.| CrowdStrike Holdings vs. BII Railway Transportation | CrowdStrike Holdings vs. Stag Industrial | CrowdStrike Holdings vs. TRAINLINE PLC LS | CrowdStrike Holdings vs. Perseus Mining Limited |
| Altair Engineering vs. Cardinal Health | Altair Engineering vs. RYMAN HEALTHCAR | Altair Engineering vs. Universal Health Realty | Altair Engineering vs. BOS BETTER ONLINE |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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