Correlation Between Adyen NV and MongoDB

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

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

Diversification Opportunities for Adyen NV and MongoDB

-0.01

Correlation Coefficient

Adyen NV  MongoDB

Good diversification

The 3 months correlation between Adyen and MongoDB is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Adyen NV and MongoDB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MongoDB and Adyen NV 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 Adyen NV are associated (or correlated) with MongoDB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MongoDB has no effect on the direction of Adyen NV i.e., Adyen NV and MongoDB go up and down completely randomly.

Pair Corralation between Adyen NV and MongoDB

Assuming the 90 days horizon Adyen NV is expected to under-perform the MongoDB. But the stock apears to be less risky and, when comparing its historical volatility, Adyen NV is 1.3 times less risky than MongoDB. The stock trades about -0.01 of its potential returns per unit of risk. The MongoDB is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  15,280  in MongoDB on May 5, 2025 and sell it today you would earn a total of  3,742  from holding MongoDB or generate 24.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Adyen NV  vs.  MongoDB

Adyen NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Adyen NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Adyen NV is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

MongoDB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MongoDB are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, MongoDB reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Adyen NV and MongoDB

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

The idea behind Adyen NV and MongoDB 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.