Correlation Between Asana and MondayCom

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

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

Diversification Opportunities for Asana and MondayCom

0.38

Correlation Coefficient

Asana  MondayCom

Weak diversification

The 3 months correlation between Asana and MondayCom is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Asana Inc and MondayCom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MondayCom and Asana 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 Asana Inc 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 Asana i.e., Asana and MondayCom go up and down completely randomly.

Pair Corralation between Asana and MondayCom

Given the investment horizon of 90 days Asana Inc is expected to under-perform the MondayCom. In addition to that, Asana is 1.02 times more volatile than MondayCom. It trades about -0.08 of its total potential returns per unit of risk. MondayCom is currently generating about 0.04 per unit of volatility. If you would invest  23,529  in MondayCom on December 29, 2024 and sell it today you would earn a total of  1,172  from holding MondayCom or generate 4.98% return on investment over 90 days.

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

Asana Inc  vs.  MondayCom

Asana Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Asana Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

MondayCom

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MondayCom are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting fundamental indicators, MondayCom may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Asana and MondayCom

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

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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.