Correlation Between Zoom Video and Lundin Mining
Can any of the company-specific risk be diversified away by investing in both Zoom Video and Lundin Mining 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 Zoom Video and Lundin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zoom Video Communications and Lundin Mining Corp, you can compare the effects of market volatilities on Zoom Video and Lundin Mining 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 Zoom Video with a short position of Lundin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoom Video and Lundin Mining.
Diversification Opportunities for Zoom Video and Lundin Mining
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zoom and Lundin is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Zoom Video Communications and Lundin Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lundin Mining Corp and Zoom Video 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 Zoom Video Communications are associated (or correlated) with Lundin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lundin Mining Corp has no effect on the direction of Zoom Video i.e., Zoom Video and Lundin Mining go up and down completely randomly.
Pair Corralation between Zoom Video and Lundin Mining
Assuming the 90 days trading horizon Zoom Video is expected to generate 1.86 times less return on investment than Lundin Mining. But when comparing it to its historical volatility, Zoom Video Communications is 1.31 times less risky than Lundin Mining. It trades about 0.03 of its potential returns per unit of risk. Lundin Mining Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 8,329 in Lundin Mining Corp on September 3, 2024 and sell it today you would earn a total of 2,471 from holding Lundin Mining Corp or generate 29.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.37% |
| Values | Daily Returns |
Zoom Video Communications vs. Lundin Mining Corp
Performance |
| Timeline |
| Zoom Video Communications |
| Lundin Mining Corp |
Zoom Video and Lundin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoom Video and Lundin Mining
The main advantage of trading using opposite Zoom Video and Lundin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoom Video position performs unexpectedly, Lundin Mining 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 Lundin Mining will offset losses from the drop in Lundin Mining's long position.| Zoom Video vs. Griffin Mining | Zoom Video vs. Sovereign Metals | Zoom Video vs. iShares Physical Silver | Zoom Video vs. AMG Advanced Metallurgical |
| Lundin Mining vs. CVS Health Corp | Lundin Mining vs. Optima Health plc | Lundin Mining vs. Primary Health Properties | Lundin Mining vs. Worldwide Healthcare Trust |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |