Correlation Between Blackline and Workiva
Can any of the company-specific risk be diversified away by investing in both Blackline and Workiva 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 Blackline and Workiva into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackline and Workiva, you can compare the effects of market volatilities on Blackline and Workiva 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 Blackline with a short position of Workiva. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackline and Workiva.
Diversification Opportunities for Blackline and Workiva
Poor diversification
The 3 months correlation between Blackline and Workiva is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Blackline and Workiva in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Workiva and Blackline 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 Blackline are associated (or correlated) with Workiva. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Workiva has no effect on the direction of Blackline i.e., Blackline and Workiva go up and down completely randomly.
Pair Corralation between Blackline and Workiva
Allowing for the 90-day total investment horizon Blackline is expected to generate 3.96 times less return on investment than Workiva. In addition to that, Blackline is 1.08 times more volatile than Workiva. It trades about 0.01 of its total potential returns per unit of risk. Workiva is currently generating about 0.04 per unit of volatility. If you would invest 9,789 in Workiva on October 20, 2024 and sell it today you would earn a total of 1,414 from holding Workiva or generate 14.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackline vs. Workiva
Performance |
| Timeline |
| Blackline |
| Workiva |
Blackline and Workiva Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackline and Workiva
The main advantage of trading using opposite Blackline and Workiva positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackline position performs unexpectedly, Workiva 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 Workiva will offset losses from the drop in Workiva's long position.| Blackline vs. Manhattan Associates | Blackline vs. Aspen Technology | Blackline vs. DoubleVerify Holdings | Blackline vs. ANSYS Inc |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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