Correlation Between Manhattan Associates and Momentive Global

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

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

Diversification Opportunities for Manhattan Associates and Momentive Global

0.33

Correlation Coefficient

Manhattan Associates  Momentive Global

Weak diversification

The 3 months correlation between Manhattan and Momentive is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Manhattan Associates and Momentive Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Momentive Global and Manhattan Associates 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 Manhattan Associates are associated (or correlated) with Momentive Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Momentive Global has no effect on the direction of Manhattan Associates i.e., Manhattan Associates and Momentive Global go up and down completely randomly.

Pair Corralation between Manhattan Associates and Momentive Global

If you would invest  26,443  in Manhattan Associates on August 30, 2024 and sell it today you would earn a total of  2,325  from holding Manhattan Associates or generate 8.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

Manhattan Associates  vs.  Momentive Global

Manhattan Associates

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Manhattan Associates are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Manhattan Associates may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Momentive Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Momentive Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Momentive Global is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Manhattan Associates and Momentive Global

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

The idea behind Manhattan Associates and Momentive Global 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..