Correlation Between Coursera and Datadog

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

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

Diversification Opportunities for Coursera and Datadog

-0.13

Correlation Coefficient

Coursera  Datadog

Good diversification

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

Pair Corralation between Coursera and Datadog

Given the investment horizon of 90 days Coursera is expected to generate 1.95 times more return on investment than Datadog. However, Coursera is 1.95 times more volatile than Datadog. It trades about 0.14 of its potential returns per unit of risk. Datadog is currently generating about 0.23 per unit of risk. If you would invest  841.00  in Coursera on May 1, 2025 and sell it today you would earn a total of  360.00  from holding Coursera or generate 42.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Coursera  vs.  Datadog

Coursera

Risk-Adjusted Performance

OK

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

Datadog

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Datadog are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Datadog reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Coursera and Datadog

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

The idea behind Coursera and Datadog 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.

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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.