Correlation Between NASDAQ TEST and Freshworks

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

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

Diversification Opportunities for NASDAQ TEST and Freshworks

-0.18

Correlation Coefficient

NASDAQ TEST  Freshworks

Good diversification

The 3 months correlation between NASDAQ and Freshworks is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding NASDAQ TEST STOCK and Freshworks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freshworks and NASDAQ TEST 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 NASDAQ TEST STOCK are associated (or correlated) with Freshworks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freshworks has no effect on the direction of NASDAQ TEST i.e., NASDAQ TEST and Freshworks go up and down completely randomly.

Pair Corralation between NASDAQ TEST and Freshworks

Assuming the 90 days horizon NASDAQ TEST STOCK is expected to generate 3.51 times more return on investment than Freshworks. However, NASDAQ TEST is 3.51 times more volatile than Freshworks. It trades about 0.08 of its potential returns per unit of risk. Freshworks is currently generating about -0.3 per unit of risk. If you would invest  1,783  in NASDAQ TEST STOCK on May 7, 2025 and sell it today you would earn a total of  80.00  from holding NASDAQ TEST STOCK or generate 4.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	76.19%
Values	Daily Returns

NASDAQ TEST STOCK  vs.  Freshworks

NASDAQ TEST STOCK

Risk-Adjusted Performance

Very Weak

Over the last 90 days NASDAQ TEST STOCK has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, NASDAQ TEST is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Freshworks

Risk-Adjusted Performance

Very Weak

Over the last 90 days Freshworks has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with NASDAQ TEST and Freshworks

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

The idea behind NASDAQ TEST STOCK and Freshworks 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 Anywhere module to track or share privately all of your investments from the convenience of any device.