Correlation Between Jfrog and Powerschool Holdings

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

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

Diversification Opportunities for Jfrog and Powerschool Holdings

0.51

Correlation Coefficient

Jfrog  Powerschool Holdings

Very weak diversification

The 3 months correlation between Jfrog and Powerschool is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Jfrog and Powerschool Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Powerschool Holdings and Jfrog 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 Jfrog are associated (or correlated) with Powerschool Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Powerschool Holdings has no effect on the direction of Jfrog i.e., Jfrog and Powerschool Holdings go up and down completely randomly.

Pair Corralation between Jfrog and Powerschool Holdings

If you would invest  2,904  in Jfrog on September 30, 2024 and sell it today you would earn a total of  52.00  from holding Jfrog or generate 1.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	4.69%
Values	Daily Returns

Jfrog  vs.  Powerschool Holdings

Jfrog

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jfrog are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Jfrog is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Powerschool Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Jfrog and Powerschool Holdings

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

The idea behind Jfrog and Powerschool Holdings 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.