Correlation Between Semrush Holdings and Bentley Systems

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

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

Diversification Opportunities for Semrush Holdings and Bentley Systems

0.66

Correlation Coefficient

Semrush Holdings  Bentley Systems

Poor diversification

The 3 months correlation between Semrush and Bentley is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Semrush Holdings and Bentley Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bentley Systems and Semrush Holdings 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 Semrush Holdings are associated (or correlated) with Bentley Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bentley Systems has no effect on the direction of Semrush Holdings i.e., Semrush Holdings and Bentley Systems go up and down completely randomly.

Pair Corralation between Semrush Holdings and Bentley Systems

Given the investment horizon of 90 days Semrush Holdings is expected to generate 2.65 times more return on investment than Bentley Systems. However, Semrush Holdings is 2.65 times more volatile than Bentley Systems. It trades about -0.06 of its potential returns per unit of risk. Bentley Systems is currently generating about -0.15 per unit of risk. If you would invest  1,184  in Semrush Holdings on December 28, 2024 and sell it today you would lose (226.00) from holding Semrush Holdings or give up 19.09% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.36%
Values	Daily Returns

Semrush Holdings  vs.  Bentley Systems

Semrush Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Semrush Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's primary indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Bentley Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bentley Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Semrush Holdings and Bentley Systems

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

The idea behind Semrush Holdings and Bentley Systems 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.