Correlation Between MongoDB and HP

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

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

Diversification Opportunities for MongoDB and HP

-0.44

Correlation Coefficient

MongoDB  HP

Very good diversification

The 3 months correlation between MongoDB and HP is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding MongoDB and HP Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HP Inc and MongoDB 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 MongoDB are associated (or correlated) with HP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HP Inc has no effect on the direction of MongoDB i.e., MongoDB and HP go up and down completely randomly.

Pair Corralation between MongoDB and HP

Considering the 90-day investment horizon MongoDB is expected to generate 1.52 times more return on investment than HP. However, MongoDB is 1.52 times more volatile than HP Inc. It trades about 0.09 of its potential returns per unit of risk. HP Inc is currently generating about -0.05 per unit of risk. If you would invest  18,901  in MongoDB on May 18, 2025 and sell it today you would earn a total of  2,925  from holding MongoDB or generate 15.48% return on investment over 90 days.

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

MongoDB  vs.  HP Inc

MongoDB

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in MongoDB are ranked lower than 7 (%) 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.

HP Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days HP Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, HP is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with MongoDB and HP

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

The idea behind MongoDB and HP 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.