Correlation Between Zenvia and Kambi Group

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

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

Diversification Opportunities for Zenvia and Kambi Group

-0.62

Correlation Coefficient

Zenvia  Kambi Group

Excellent diversification

The 3 months correlation between Zenvia and Kambi is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Zenvia Inc and Kambi Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kambi Group plc and Zenvia 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 Zenvia Inc are associated (or correlated) with Kambi Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kambi Group plc has no effect on the direction of Zenvia i.e., Zenvia and Kambi Group go up and down completely randomly.

Pair Corralation between Zenvia and Kambi Group

Given the investment horizon of 90 days Zenvia Inc is expected to generate 1.12 times more return on investment than Kambi Group. However, Zenvia is 1.12 times more volatile than Kambi Group plc. It trades about 0.11 of its potential returns per unit of risk. Kambi Group plc is currently generating about -0.22 per unit of risk. If you would invest  172.00  in Zenvia Inc on September 27, 2024 and sell it today you would earn a total of  20.00  from holding Zenvia Inc or generate 11.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Zenvia Inc  vs.  Kambi Group plc

Zenvia Inc

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Zenvia Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Zenvia showed solid returns over the last few months and may actually be approaching a breakup point.

Kambi Group plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kambi Group plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's forward indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Zenvia and Kambi Group

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

The idea behind Zenvia Inc and Kambi Group plc 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.