Correlation Between Dynatrace Holdings and Gitlab

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

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

Diversification Opportunities for Dynatrace Holdings and Gitlab

0.89

Correlation Coefficient

Dynatrace Holdings  Gitlab

Very poor diversification

The 3 months correlation between Dynatrace and Gitlab is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Dynatrace Holdings LLC and Gitlab Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gitlab Inc and Dynatrace 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 Dynatrace Holdings LLC are associated (or correlated) with Gitlab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gitlab Inc has no effect on the direction of Dynatrace Holdings i.e., Dynatrace Holdings and Gitlab go up and down completely randomly.

Pair Corralation between Dynatrace Holdings and Gitlab

Allowing for the 90-day total investment horizon Dynatrace Holdings is expected to generate 5.96 times less return on investment than Gitlab. But when comparing it to its historical volatility, Dynatrace Holdings LLC is 1.92 times less risky than Gitlab. It trades about 0.01 of its potential returns per unit of risk. Gitlab Inc is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  3,036  in Gitlab Inc on January 17, 2025 and sell it today you would earn a total of  1,254  from holding Gitlab Inc or generate 41.3% return on investment over 90 days.

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

Dynatrace Holdings LLC  vs.  Gitlab Inc

Dynatrace Holdings LLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dynatrace Holdings LLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in May 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Gitlab Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gitlab Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's essential indicators remain somewhat strong which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Dynatrace Holdings and Gitlab

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

The idea behind Dynatrace Holdings LLC and Gitlab Inc 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.