Correlation Between PROS Holdings and SAP SE
Can any of the company-specific risk be diversified away by investing in both PROS Holdings and SAP SE 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 PROS Holdings and SAP SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PROS Holdings and SAP SE, you can compare the effects of market volatilities on PROS Holdings and SAP SE 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 PROS Holdings with a short position of SAP SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PROS Holdings and SAP SE.
Diversification Opportunities for PROS Holdings and SAP SE
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between PROS and SAP is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding PROS Holdings and SAP SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE and PROS 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 PROS Holdings are associated (or correlated) with SAP SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE has no effect on the direction of PROS Holdings i.e., PROS Holdings and SAP SE go up and down completely randomly.
Pair Corralation between PROS Holdings and SAP SE
Considering the 90-day investment horizon PROS Holdings is expected to generate 1.62 times less return on investment than SAP SE. In addition to that, PROS Holdings is 1.69 times more volatile than SAP SE. It trades about 0.03 of its total potential returns per unit of risk. SAP SE is currently generating about 0.09 per unit of volatility. If you would invest 8,987 in SAP SE on January 27, 2024 and sell it today you would earn a total of 9,098 from holding SAP SE or generate 101.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PROS Holdings vs. SAP SE
Performance |
| Timeline |
| PROS Holdings |
| SAP SE |
PROS Holdings and SAP SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PROS Holdings and SAP SE
The main advantage of trading using opposite PROS Holdings and SAP SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PROS Holdings position performs unexpectedly, SAP SE 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 SAP SE will offset losses from the drop in SAP SE's long position.| PROS Holdings vs. C3 Ai Inc | PROS Holdings vs. Shopify | PROS Holdings vs. Snowflake | PROS Holdings vs. ServiceNow |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |