Correlation Between Zoom Video and New Asia
Can any of the company-specific risk be diversified away by investing in both Zoom Video and New Asia 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 New Asia 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 New Asia Holdings, you can compare the effects of market volatilities on Zoom Video and New Asia 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 New Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoom Video and New Asia.
Diversification Opportunities for Zoom Video and New Asia
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Zoom and New is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Zoom Video Communications and New Asia Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Asia 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 New Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Asia Holdings has no effect on the direction of Zoom Video i.e., Zoom Video and New Asia go up and down completely randomly.
Pair Corralation between Zoom Video and New Asia
Allowing for the 90-day total investment horizon Zoom Video Communications is expected to generate 0.19 times more return on investment than New Asia. However, Zoom Video Communications is 5.22 times less risky than New Asia. It trades about 0.18 of its potential returns per unit of risk. New Asia Holdings is currently generating about -0.34 per unit of risk. If you would invest 7,474 in Zoom Video Communications on September 1, 2024 and sell it today you would earn a total of 795.00 from holding Zoom Video Communications or generate 10.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Zoom Video Communications vs. New Asia Holdings
Performance |
| Timeline |
| Zoom Video Communications |
| New Asia Holdings |
Zoom Video and New Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoom Video and New Asia
The main advantage of trading using opposite Zoom Video and New Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoom Video position performs unexpectedly, New Asia 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 New Asia will offset losses from the drop in New Asia's long position.| Zoom Video vs. Ke Holdings | Zoom Video vs. nCino Inc | Zoom Video vs. Kingsoft Cloud Holdings | Zoom Video vs. Jfrog |
| New Asia vs. Research Solutions | New Asia vs. Red Violet | New Asia vs. Meridianlink | New Asia vs. PDF Solutions |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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