Correlation Between Fastly and MongoDB

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

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

Diversification Opportunities for Fastly and MongoDB

0.5

Correlation Coefficient

Fastly  MongoDB

Very weak diversification

The 3 months correlation between Fastly and MongoDB is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Fastly Inc and MongoDB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MongoDB and Fastly 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 Fastly Inc 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 Fastly i.e., Fastly and MongoDB go up and down completely randomly.

Pair Corralation between Fastly and MongoDB

Given the investment horizon of 90 days Fastly is expected to generate 1.34 times less return on investment than MongoDB. In addition to that, Fastly is 1.73 times more volatile than MongoDB. It trades about 0.09 of its total potential returns per unit of risk. MongoDB is currently generating about 0.22 per unit of volatility. If you would invest  17,451  in MongoDB on April 28, 2025 and sell it today you would earn a total of  6,686  from holding MongoDB or generate 38.31% return on investment over 90 days.

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

Fastly Inc  vs.  MongoDB

Fastly Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fastly Inc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady essential indicators, Fastly showed solid returns over the last few months and may actually be approaching a breakup point.

MongoDB

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in MongoDB are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain fundamental indicators, MongoDB sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fastly and MongoDB

The main advantage of trading using opposite Fastly and MongoDB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fastly 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 Fastly Inc 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.