Correlation Between New Relic and Progress Software

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

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

Diversification Opportunities for New Relic and Progress Software

0.0

Correlation Coefficient

New Relic  Progress Software

Pay attention - limited upside

The 3 months correlation between New and Progress is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding New Relic and Progress Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progress Software and New Relic 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 New Relic 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 New Relic i.e., New Relic and Progress Software go up and down completely randomly.

Pair Corralation between New Relic and Progress Software

If you would invest (100.00) in New Relic on December 28, 2024 and sell it today you would earn a total of  100.00  from holding New Relic or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

New Relic  vs.  Progress Software

New Relic

Risk-Adjusted Performance

Very Weak

Over the last 90 days New Relic has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, New Relic is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Progress Software

Risk-Adjusted Performance

Very Weak

Over the last 90 days Progress Software has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with New Relic and Progress Software

The main advantage of trading using opposite New Relic and Progress Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Relic 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.

The idea behind New Relic and Progress Software 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.