Correlation Between Zoom Video and Kraken Energy
Can any of the company-specific risk be diversified away by investing in both Zoom Video and Kraken Energy 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 Kraken Energy 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 Kraken Energy Corp, you can compare the effects of market volatilities on Zoom Video and Kraken Energy 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 Kraken Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoom Video and Kraken Energy.
Diversification Opportunities for Zoom Video and Kraken Energy
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Zoom and Kraken is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Zoom Video Communications and Kraken Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kraken Energy Corp 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 Kraken Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kraken Energy Corp has no effect on the direction of Zoom Video i.e., Zoom Video and Kraken Energy go up and down completely randomly.
Pair Corralation between Zoom Video and Kraken Energy
Allowing for the 90-day total investment horizon Zoom Video Communications is expected to generate 0.39 times more return on investment than Kraken Energy. However, Zoom Video Communications is 2.54 times less risky than Kraken Energy. It trades about 0.18 of its potential returns per unit of risk. Kraken Energy Corp is currently generating about -0.13 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zoom Video Communications vs. Kraken Energy Corp
Performance |
| Timeline |
| Zoom Video Communications |
| Kraken Energy Corp |
Zoom Video and Kraken Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoom Video and Kraken Energy
The main advantage of trading using opposite Zoom Video and Kraken Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoom Video position performs unexpectedly, Kraken Energy 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 Kraken Energy will offset losses from the drop in Kraken Energy's long position.| Zoom Video vs. Ke Holdings | Zoom Video vs. nCino Inc | Zoom Video vs. Kingsoft Cloud Holdings | Zoom Video vs. Jfrog |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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