Correlation Between Couchbase and MondayCom

Can any of the company-specific risk be diversified away by investing in both Couchbase 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 Couchbase and MondayCom into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Couchbase and MondayCom, you can compare the effects of market volatilities on Couchbase 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 Couchbase with a short position of MondayCom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Couchbase and MondayCom.

Diversification Opportunities for Couchbase and MondayCom

0.11

Correlation Coefficient

Couchbase  MondayCom

Average diversification

The 3 months correlation between Couchbase and MondayCom is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Couchbase and MondayCom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MondayCom and Couchbase 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 Couchbase 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 Couchbase i.e., Couchbase and MondayCom go up and down completely randomly.

Pair Corralation between Couchbase and MondayCom

Given the investment horizon of 90 days Couchbase is expected to generate 1.05 times more return on investment than MondayCom. However, Couchbase is 1.05 times more volatile than MondayCom. It trades about 0.04 of its potential returns per unit of risk. MondayCom is currently generating about -0.05 per unit of risk. If you would invest  1,491  in Couchbase on September 26, 2024 and sell it today you would earn a total of  59.00  from holding Couchbase or generate 3.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Couchbase  vs.  MondayCom

Couchbase

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Couchbase are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Couchbase may actually be approaching a critical reversion point that can send shares even higher in January 2025.

MondayCom

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MondayCom has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Couchbase and MondayCom

The main advantage of trading using opposite Couchbase and MondayCom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Couchbase 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.

The idea behind Couchbase and MondayCom 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.

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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.