Correlation Between Blackbaud and Progress Software
Can any of the company-specific risk be diversified away by investing in both Blackbaud and Progress Software 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 Blackbaud and Progress Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackbaud and Progress Software, you can compare the effects of market volatilities on Blackbaud and Progress Software 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 Blackbaud with a short position of Progress Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackbaud and Progress Software.
Diversification Opportunities for Blackbaud and Progress Software
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Blackbaud and Progress is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Blackbaud and Progress Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progress Software and Blackbaud 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 Blackbaud are associated (or correlated) with Progress Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progress Software has no effect on the direction of Blackbaud i.e., Blackbaud and Progress Software go up and down completely randomly.
Pair Corralation between Blackbaud and Progress Software
Given the investment horizon of 90 days Blackbaud is expected to generate 1.06 times more return on investment than Progress Software. However, Blackbaud is 1.06 times more volatile than Progress Software. It trades about -0.1 of its potential returns per unit of risk. Progress Software is currently generating about -0.18 per unit of risk. If you would invest 7,372 in Blackbaud on December 2, 2024 and sell it today you would lose (762.00) from holding Blackbaud or give up 10.34% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Blackbaud vs. Progress Software
Performance |
Timeline |
Blackbaud |
Progress Software |
Blackbaud and Progress Software Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Blackbaud and Progress Software
The main advantage of trading using opposite Blackbaud and Progress Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackbaud position performs unexpectedly, Progress Software 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 Progress Software will offset losses from the drop in Progress Software's long position.Blackbaud vs. Progress Software | Blackbaud vs. Enfusion | Blackbaud vs. E2open Parent Holdings | Blackbaud vs. Aspen Technology |
Progress Software vs. ePlus inc | Progress Software vs. Agilysys | Progress Software vs. Sapiens International | Progress Software vs. PDF Solutions |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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