Correlation Between Zoom Video and Graham Holdings
Can any of the company-specific risk be diversified away by investing in both Zoom Video and Graham Holdings 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 Graham Holdings 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 Graham Holdings Co, you can compare the effects of market volatilities on Zoom Video and Graham Holdings 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 Graham Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoom Video and Graham Holdings.
Diversification Opportunities for Zoom Video and Graham Holdings
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Zoom and Graham is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Zoom Video Communications and Graham Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graham Holdings 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 Graham Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graham Holdings has no effect on the direction of Zoom Video i.e., Zoom Video and Graham Holdings go up and down completely randomly.
Pair Corralation between Zoom Video and Graham Holdings
Assuming the 90 days trading horizon Zoom Video is expected to generate 1.57 times less return on investment than Graham Holdings. In addition to that, Zoom Video is 1.3 times more volatile than Graham Holdings Co. It trades about 0.03 of its total potential returns per unit of risk. Graham Holdings Co is currently generating about 0.06 per unit of volatility. If you would invest 55,261 in Graham Holdings Co on October 14, 2024 and sell it today you would earn a total of 29,239 from holding Graham Holdings Co or generate 52.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zoom Video Communications vs. Graham Holdings Co
Performance |
| Timeline |
| Zoom Video Communications |
| Graham Holdings |
Zoom Video and Graham Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoom Video and Graham Holdings
The main advantage of trading using opposite Zoom Video and Graham Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoom Video position performs unexpectedly, Graham Holdings 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 Graham Holdings will offset losses from the drop in Graham Holdings' long position.| Zoom Video vs. Direct Line Insurance | Zoom Video vs. Semiconductor Manufacturing International | Zoom Video vs. United Insurance Holdings | Zoom Video vs. JSC Halyk bank |
| Graham Holdings vs. GRUPO CARSO A1 | Graham Holdings vs. Computershare Limited | Graham Holdings vs. CRISPR Therapeutics AG | Graham Holdings vs. Zoom Video Communications |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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