Correlation Between Zoom Video and Microbot Medical
Can any of the company-specific risk be diversified away by investing in both Zoom Video and Microbot Medical 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 Microbot Medical 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 Microbot Medical, you can compare the effects of market volatilities on Zoom Video and Microbot Medical 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 Microbot Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoom Video and Microbot Medical.
Diversification Opportunities for Zoom Video and Microbot Medical
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zoom and Microbot is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Zoom Video Communications and Microbot Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbot Medical 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 Microbot Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbot Medical has no effect on the direction of Zoom Video i.e., Zoom Video and Microbot Medical go up and down completely randomly.
Pair Corralation between Zoom Video and Microbot Medical
Assuming the 90 days trading horizon Zoom Video Communications is expected to generate 0.3 times more return on investment than Microbot Medical. However, Zoom Video Communications is 3.3 times less risky than Microbot Medical. It trades about 0.06 of its potential returns per unit of risk. Microbot Medical is currently generating about 0.01 per unit of risk. If you would invest 6,253 in Zoom Video Communications on September 3, 2024 and sell it today you would earn a total of 1,683 from holding Zoom Video Communications or generate 26.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zoom Video Communications vs. Microbot Medical
Performance |
| Timeline |
| Zoom Video Communications |
| Microbot Medical |
Zoom Video and Microbot Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoom Video and Microbot Medical
The main advantage of trading using opposite Zoom Video and Microbot Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoom Video position performs unexpectedly, Microbot Medical 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 Microbot Medical will offset losses from the drop in Microbot Medical's long position.| Zoom Video vs. Nomad Foods | Zoom Video vs. CAL MAINE FOODS | Zoom Video vs. ADRIATIC METALS LS 013355 | Zoom Video vs. THAI BEVERAGE |
| Microbot Medical vs. MAGIC SOFTWARE ENTR | Microbot Medical vs. Darden Restaurants | Microbot Medical vs. USU Software AG | Microbot Medical vs. Guidewire Software |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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