Correlation Between Walkme and S A P

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

By analyzing existing cross correlation between Walkme and SAP SE ADR, you can compare the effects of market volatilities on Walkme and S A P 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 Walkme with a short position of S A P. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walkme and S A P.

Diversification Opportunities for Walkme and S A P

0.06

Correlation Coefficient

Walkme  S A P

Significant diversification

The 3 months correlation between Walkme and SAP is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Walkme and SAP SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE ADR and Walkme 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 Walkme are associated (or correlated) with S A P. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE ADR has no effect on the direction of Walkme i.e., Walkme and S A P go up and down completely randomly.

Pair Corralation between Walkme and S A P

If you would invest  23,381  in SAP SE ADR on September 25, 2024 and sell it today you would earn a total of  1,983  from holding SAP SE ADR or generate 8.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Walkme  vs.  SAP SE ADR

Walkme

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Walkme has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, Walkme is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

SAP SE ADR

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SAP SE ADR are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting basic indicators, S A P reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Walkme and S A P

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

The idea behind Walkme and SAP SE ADR 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.