Correlation Between ZIM Integrated and MongoDB

Can any of the company-specific risk be diversified away by investing in both ZIM Integrated and MongoDB 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 ZIM Integrated and MongoDB into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ZIM Integrated Shipping and MongoDB, you can compare the effects of market volatilities on ZIM Integrated and MongoDB 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 ZIM Integrated with a short position of MongoDB. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZIM Integrated and MongoDB.

Diversification Opportunities for ZIM Integrated and MongoDB

0.64

Correlation Coefficient

ZIM Integrated  MongoDB

Poor diversification

The 3 months correlation between ZIM and MongoDB is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding ZIM Integrated Shipping and MongoDB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MongoDB and ZIM Integrated 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 ZIM Integrated Shipping are associated (or correlated) with MongoDB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MongoDB has no effect on the direction of ZIM Integrated i.e., ZIM Integrated and MongoDB go up and down completely randomly.

Pair Corralation between ZIM Integrated and MongoDB

Considering the 90-day investment horizon ZIM Integrated Shipping is expected to under-perform the MongoDB. In addition to that, ZIM Integrated is 1.44 times more volatile than MongoDB. It trades about -0.04 of its total potential returns per unit of risk. MongoDB is currently generating about -0.02 per unit of volatility. If you would invest  39,529  in MongoDB on January 26, 2024 and sell it today you would lose (2,600) from holding MongoDB or give up 6.58% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

ZIM Integrated Shipping  vs.  MongoDB

ZIM Integrated Shipping

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ZIM Integrated Shipping has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's forward indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

MongoDB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MongoDB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, MongoDB is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ZIM Integrated and MongoDB

The main advantage of trading using opposite ZIM Integrated and MongoDB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZIM Integrated position performs unexpectedly, MongoDB 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 MongoDB will offset losses from the drop in MongoDB's long position.

The idea behind ZIM Integrated Shipping and MongoDB pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.