Correlation Between Teladoc and Zoom Video
Can any of the company-specific risk be diversified away by investing in both Teladoc 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 Teladoc and Zoom Video into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teladoc and Zoom Video Communications, you can compare the effects of market volatilities on Teladoc 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 Teladoc with a short position of Zoom Video. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teladoc and Zoom Video.
Diversification Opportunities for Teladoc and Zoom Video
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Teladoc and Zoom is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Teladoc 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 Teladoc 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 Teladoc 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 Teladoc i.e., Teladoc and Zoom Video go up and down completely randomly.
Pair Corralation between Teladoc and Zoom Video
Given the investment horizon of 90 days Teladoc is expected to generate 1.87 times more return on investment than Zoom Video. However, Teladoc is 1.87 times more volatile than Zoom Video Communications. It trades about 0.55 of its potential returns per unit of risk. Zoom Video Communications is currently generating about 0.2 per unit of risk. If you would invest 909.00 in Teladoc on November 18, 2024 and sell it today you would earn a total of 524.00 from holding Teladoc or generate 57.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teladoc vs. Zoom Video Communications
Performance |
| Timeline |
| Teladoc |
| Zoom Video Communications |
Teladoc and Zoom Video Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teladoc and Zoom Video
The main advantage of trading using opposite Teladoc and Zoom Video positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teladoc 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.| Teladoc vs. Veeva Systems Class | Teladoc vs. 10X Genomics | Teladoc vs. GE HealthCare Technologies | Teladoc vs. Progyny |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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