Correlation Between Veeva Systems and Progyny

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

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

Diversification Opportunities for Veeva Systems and Progyny

0.68

Correlation Coefficient

Veeva Systems  Progyny

Poor diversification

The 3 months correlation between Veeva and Progyny is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Veeva Systems Class and Progyny in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progyny and Veeva Systems 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 Veeva Systems Class are associated (or correlated) with Progyny. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progyny has no effect on the direction of Veeva Systems i.e., Veeva Systems and Progyny go up and down completely randomly.

Pair Corralation between Veeva Systems and Progyny

Given the investment horizon of 90 days Veeva Systems Class is expected to generate 0.66 times more return on investment than Progyny. However, Veeva Systems Class is 1.52 times less risky than Progyny. It trades about 0.02 of its potential returns per unit of risk. Progyny is currently generating about 0.01 per unit of risk. If you would invest  19,145  in Veeva Systems Class on February 28, 2024 and sell it today you would earn a total of  1,244  from holding Veeva Systems Class or generate 6.5% return on investment over 90 days.

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

Veeva Systems Class  vs.  Progyny

Veeva Systems Class

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Veeva Systems Class has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Progyny

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Progyny has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Veeva Systems and Progyny

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

The idea behind Veeva Systems Class and Progyny 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.

Check out your portfolio center.

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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.