Correlation Between Workday and MondayCom
Can any of the company-specific risk be diversified away by investing in both Workday and MondayCom 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 Workday and MondayCom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Workday and MondayCom, you can compare the effects of market volatilities on Workday and MondayCom 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 Workday with a short position of MondayCom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Workday and MondayCom.
Diversification Opportunities for Workday and MondayCom
Very good diversification
The 3 months correlation between Workday and MondayCom is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Workday and MondayCom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MondayCom and Workday 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 Workday are associated (or correlated) with MondayCom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MondayCom has no effect on the direction of Workday i.e., Workday and MondayCom go up and down completely randomly.
Pair Corralation between Workday and MondayCom
Given the investment horizon of 90 days Workday is expected to generate 0.55 times more return on investment than MondayCom. However, Workday is 1.82 times less risky than MondayCom. It trades about 0.1 of its potential returns per unit of risk. MondayCom is currently generating about -0.03 per unit of risk. If you would invest 23,912 in Workday on September 2, 2024 and sell it today you would earn a total of 1,087 from holding Workday or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Workday vs. MondayCom
Performance |
| Timeline |
| Workday |
| MondayCom |
Workday and MondayCom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Workday and MondayCom
The main advantage of trading using opposite Workday and MondayCom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Workday position performs unexpectedly, MondayCom 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 MondayCom will offset losses from the drop in MondayCom's long position.| Workday vs. Intuit Inc | Workday vs. Zoom Video Communications | Workday vs. ServiceNow | Workday vs. Snowflake |
| MondayCom vs. Ke Holdings | MondayCom vs. nCino Inc | MondayCom vs. Kingsoft Cloud Holdings | MondayCom vs. Jfrog |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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