Correlation Between 49326EEN9 and Zoom Video

Can any of the company-specific risk be diversified away by investing in both 49326EEN9 and Zoom Video 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 49326EEN9 and Zoom Video into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between KEY 4789 01 JUN 33 and Zoom Video Communications, you can compare the effects of market volatilities on 49326EEN9 and Zoom Video 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 49326EEN9 with a short position of Zoom Video. Check out your portfolio center. Please also check ongoing floating volatility patterns of 49326EEN9 and Zoom Video.

Diversification Opportunities for 49326EEN9 and Zoom Video

-0.2

Correlation Coefficient

49326EEN9  Zoom Video

Good diversification

The 3 months correlation between 49326EEN9 and Zoom is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding KEY 4789 01 JUN 33 and Zoom Video Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoom Video Communications and 49326EEN9 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 KEY 4789 01 JUN 33 are associated (or correlated) with Zoom Video. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoom Video Communications has no effect on the direction of 49326EEN9 i.e., 49326EEN9 and Zoom Video go up and down completely randomly.

Pair Corralation between 49326EEN9 and Zoom Video

Assuming the 90 days trading horizon KEY 4789 01 JUN 33 is expected to under-perform the Zoom Video. But the bond apears to be less risky and, when comparing its historical volatility, KEY 4789 01 JUN 33 is 1.1 times less risky than Zoom Video. The bond trades about -0.16 of its potential returns per unit of risk. The Zoom Video Communications is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  6,789  in Zoom Video Communications on October 13, 2024 and sell it today you would earn a total of  1,157  from holding Zoom Video Communications or generate 17.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

KEY 4789 01 JUN 33  vs.  Zoom Video Communications

KEY 4789 01

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KEY 4789 01 JUN 33 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for KEY 4789 01 JUN 33 investors.

Zoom Video Communications

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Zoom Video Communications are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent primary indicators, Zoom Video displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with 49326EEN9 and Zoom Video

The main advantage of trading using opposite 49326EEN9 and Zoom Video positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 49326EEN9 position performs unexpectedly, Zoom Video 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 Zoom Video will offset losses from the drop in Zoom Video's long position.

The idea behind KEY 4789 01 JUN 33 and Zoom Video Communications 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.