Correlation Between Autodesk and Elastic NV

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

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

Diversification Opportunities for Autodesk and Elastic NV

0.13

Correlation Coefficient

Autodesk  Elastic NV

Average diversification

The 3 months correlation between Autodesk and Elastic is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Autodesk and Elastic NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elastic NV and Autodesk 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 Autodesk are associated (or correlated) with Elastic NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elastic NV has no effect on the direction of Autodesk i.e., Autodesk and Elastic NV go up and down completely randomly.

Pair Corralation between Autodesk and Elastic NV

Given the investment horizon of 90 days Autodesk is expected to generate 0.6 times more return on investment than Elastic NV. However, Autodesk is 1.65 times less risky than Elastic NV. It trades about 0.13 of its potential returns per unit of risk. Elastic NV is currently generating about 0.03 per unit of risk. If you would invest  27,349  in Autodesk on May 1, 2025 and sell it today you would earn a total of  3,312  from holding Autodesk or generate 12.11% return on investment over 90 days.

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

Autodesk  vs.  Elastic NV

Autodesk

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Autodesk are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, Autodesk may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Elastic NV

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Elastic NV are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Elastic NV is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Autodesk and Elastic NV

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

The idea behind Autodesk and Elastic NV 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.