Correlation Between Omega Healthcare and Zoom Video
Can any of the company-specific risk be diversified away by investing in both Omega Healthcare and Zoom Video 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 Omega Healthcare and Zoom Video into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Omega Healthcare Investors and Zoom Video Communications, you can compare the effects of market volatilities on Omega Healthcare and Zoom Video 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 Omega Healthcare with a short position of Zoom Video. Check out your portfolio center. Please also check ongoing floating volatility patterns of Omega Healthcare and Zoom Video.
Diversification Opportunities for Omega Healthcare and Zoom Video
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Omega and Zoom is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Omega Healthcare Investors and Zoom Video Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoom Video Communications and Omega Healthcare 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 Omega Healthcare Investors are associated (or correlated) with Zoom Video. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoom Video Communications has no effect on the direction of Omega Healthcare i.e., Omega Healthcare and Zoom Video go up and down completely randomly.
Pair Corralation between Omega Healthcare and Zoom Video
Considering the 90-day investment horizon Omega Healthcare Investors is expected to generate 0.63 times more return on investment than Zoom Video. However, Omega Healthcare Investors is 1.6 times less risky than Zoom Video. It trades about 0.08 of its potential returns per unit of risk. Zoom Video Communications is currently generating about 0.02 per unit of risk. If you would invest 2,506 in Omega Healthcare Investors on August 24, 2024 and sell it today you would earn a total of 1,508 from holding Omega Healthcare Investors or generate 60.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Omega Healthcare Investors vs. Zoom Video Communications
Performance |
| Timeline |
| Omega Healthcare Inv |
| Zoom Video Communications |
Omega Healthcare and Zoom Video Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Omega Healthcare and Zoom Video
The main advantage of trading using opposite Omega Healthcare and Zoom Video positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Omega Healthcare position performs unexpectedly, Zoom Video 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 Zoom Video will offset losses from the drop in Zoom Video's long position.| Omega Healthcare vs. LTC Properties | Omega Healthcare vs. Healthpeak Properties | Omega Healthcare vs. Global Medical REIT | Omega Healthcare vs. Sabra Healthcare REIT |
| Zoom Video vs. Alkami Technology | Zoom Video vs. Paycor HCM | Zoom Video vs. Procore Technologies | Zoom Video vs. Enfusion |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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