Correlation Between Manhattan Associates and Dassault Systemes

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

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

Diversification Opportunities for Manhattan Associates and Dassault Systemes

-0.32

Correlation Coefficient

Manhattan Associates  Dassault Systemes

Very good diversification

The 3 months correlation between Manhattan and Dassault is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Manhattan Associates and Dassault Systemes SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dassault Systemes and Manhattan Associates 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 Manhattan Associates are associated (or correlated) with Dassault Systemes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dassault Systemes has no effect on the direction of Manhattan Associates i.e., Manhattan Associates and Dassault Systemes go up and down completely randomly.

Pair Corralation between Manhattan Associates and Dassault Systemes

If you would invest  26,920  in Manhattan Associates on September 18, 2024 and sell it today you would earn a total of  3,168  from holding Manhattan Associates or generate 11.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Manhattan Associates  vs.  Dassault Systemes SA

Manhattan Associates

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Manhattan Associates are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Manhattan Associates may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Dassault Systemes

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dassault Systemes SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Dassault Systemes is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Manhattan Associates and Dassault Systemes

The main advantage of trading using opposite Manhattan Associates and Dassault Systemes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manhattan Associates position performs unexpectedly, Dassault Systemes 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 Dassault Systemes will offset losses from the drop in Dassault Systemes' long position.

The idea behind Manhattan Associates and Dassault Systemes SA 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.

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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.