Correlation Between Upwork and Dropbox

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

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

Diversification Opportunities for Upwork and Dropbox

0.76

Correlation Coefficient

Upwork  Dropbox

Poor diversification

The 3 months correlation between Upwork and Dropbox is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Upwork Inc and Dropbox in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dropbox and Upwork 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 Upwork Inc are associated (or correlated) with Dropbox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dropbox has no effect on the direction of Upwork i.e., Upwork and Dropbox go up and down completely randomly.

Pair Corralation between Upwork and Dropbox

Given the investment horizon of 90 days Upwork Inc is expected to under-perform the Dropbox. In addition to that, Upwork is 1.42 times more volatile than Dropbox. It trades about -0.3 of its total potential returns per unit of risk. Dropbox is currently generating about -0.13 per unit of volatility. If you would invest  2,946  in Dropbox on May 9, 2025 and sell it today you would lose (295.00) from holding Dropbox or give up 10.01% of portfolio value over 90 days.

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

Upwork Inc  vs.  Dropbox

Upwork Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Upwork Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in September 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Dropbox

Risk-Adjusted Performance

Weakest

Over the last 90 days Dropbox has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental drivers remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Upwork and Dropbox

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

The idea behind Upwork Inc and Dropbox 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.