Correlation Between Ceridian HCM and Autodesk

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

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

Diversification Opportunities for Ceridian HCM and Autodesk

0.36

Correlation Coefficient

Ceridian HCM  Autodesk

Weak diversification

The 3 months correlation between Ceridian and Autodesk is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Ceridian HCM Holding and Autodesk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autodesk and Ceridian HCM 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 Ceridian HCM Holding are associated (or correlated) with Autodesk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autodesk has no effect on the direction of Ceridian HCM i.e., Ceridian HCM and Autodesk go up and down completely randomly.

Pair Corralation between Ceridian HCM and Autodesk

If you would invest  24,745  in Autodesk on September 26, 2024 and sell it today you would earn a total of  5,378  from holding Autodesk or generate 21.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	0.79%
Values	Daily Returns

Ceridian HCM Holding  vs.  Autodesk

Ceridian HCM Holding

Risk-Adjusted Performance

0 of 100

Very Weak

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

Autodesk

Risk-Adjusted Performance

7 of 100

OK

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

Pair Trading with Ceridian HCM and Autodesk

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

The idea behind Ceridian HCM Holding and Autodesk 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.