Correlation Between Pubmatic and Workday
Can any of the company-specific risk be diversified away by investing in both Pubmatic and Workday 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 Pubmatic and Workday into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pubmatic and Workday, you can compare the effects of market volatilities on Pubmatic and Workday 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 Pubmatic with a short position of Workday. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pubmatic and Workday.
Diversification Opportunities for Pubmatic and Workday
Very weak diversification
The 3 months correlation between Pubmatic and Workday is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Pubmatic and Workday in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Workday and Pubmatic 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 Pubmatic are associated (or correlated) with Workday. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Workday has no effect on the direction of Pubmatic i.e., Pubmatic and Workday go up and down completely randomly.
Pair Corralation between Pubmatic and Workday
Given the investment horizon of 90 days Pubmatic is expected to under-perform the Workday. In addition to that, Pubmatic is 1.78 times more volatile than Workday. It trades about -0.04 of its total potential returns per unit of risk. Workday is currently generating about 0.08 per unit of volatility. If you would invest 21,112 in Workday on September 2, 2024 and sell it today you would earn a total of 3,887 from holding Workday or generate 18.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pubmatic vs. Workday
Performance |
| Timeline |
| Pubmatic |
| Workday |
Pubmatic and Workday Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pubmatic and Workday
The main advantage of trading using opposite Pubmatic and Workday positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pubmatic position performs unexpectedly, Workday 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 Workday will offset losses from the drop in Workday's long position.The idea behind Pubmatic and Workday 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.| Workday vs. Intuit Inc | Workday vs. Zoom Video Communications | Workday vs. ServiceNow | Workday vs. Snowflake |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |