Correlation Between MondayCom and ZoomInfo Technologies

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

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

Diversification Opportunities for MondayCom and ZoomInfo Technologies

0.11

Correlation Coefficient

MondayCom  ZoomInfo Technologies

Average diversification

The 3 months correlation between MondayCom and ZoomInfo is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding MondayCom and ZoomInfo Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZoomInfo Technologies and MondayCom 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 MondayCom are associated (or correlated) with ZoomInfo Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZoomInfo Technologies has no effect on the direction of MondayCom i.e., MondayCom and ZoomInfo Technologies go up and down completely randomly.

Pair Corralation between MondayCom and ZoomInfo Technologies

Given the investment horizon of 90 days MondayCom is expected to generate 2.05 times more return on investment than ZoomInfo Technologies. However, MondayCom is 2.05 times more volatile than ZoomInfo Technologies. It trades about 0.04 of its potential returns per unit of risk. ZoomInfo Technologies is currently generating about -0.08 per unit of risk. If you would invest  28,536  in MondayCom on November 28, 2024 and sell it today you would earn a total of  1,197  from holding MondayCom or generate 4.19% return on investment over 90 days.

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

MondayCom  vs.  ZoomInfo Technologies

MondayCom

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in MondayCom are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile fundamental indicators, MondayCom may actually be approaching a critical reversion point that can send shares even higher in March 2025.

ZoomInfo Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days ZoomInfo Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward 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 MondayCom and ZoomInfo Technologies

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

The idea behind MondayCom and ZoomInfo Technologies 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.