Correlation Between Zenvia and Sangoma Technologies

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

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

Diversification Opportunities for Zenvia and Sangoma Technologies

-0.68

Correlation Coefficient

Zenvia  Sangoma Technologies

Excellent diversification

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

Pair Corralation between Zenvia and Sangoma Technologies

Given the investment horizon of 90 days Zenvia Inc is expected to generate 3.05 times more return on investment than Sangoma Technologies. However, Zenvia is 3.05 times more volatile than Sangoma Technologies Corp. It trades about 0.18 of its potential returns per unit of risk. Sangoma Technologies Corp is currently generating about 0.08 per unit of risk. If you would invest  142.00  in Zenvia Inc on August 30, 2024 and sell it today you would earn a total of  30.00  from holding Zenvia Inc or generate 21.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.65%
Values	Daily Returns

Zenvia Inc  vs.  Sangoma Technologies Corp

Zenvia Inc

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Zenvia Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Zenvia may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Sangoma Technologies Corp

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sangoma Technologies Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting basic indicators, Sangoma Technologies reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Zenvia and Sangoma Technologies

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

The idea behind Zenvia Inc and Sangoma Technologies Corp 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.