Correlation Between ZoomInfo Technologies and Enfusion

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

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

Diversification Opportunities for ZoomInfo Technologies and Enfusion

0.23

Correlation Coefficient

ZoomInfo Technologies  Enfusion

Modest diversification

The 3 months correlation between ZoomInfo and Enfusion is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding ZoomInfo Technologies and Enfusion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enfusion and ZoomInfo Technologies 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 ZoomInfo Technologies are associated (or correlated) with Enfusion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enfusion has no effect on the direction of ZoomInfo Technologies i.e., ZoomInfo Technologies and Enfusion go up and down completely randomly.

Pair Corralation between ZoomInfo Technologies and Enfusion

Allowing for the 90-day total investment horizon ZoomInfo Technologies is expected to under-perform the Enfusion. In addition to that, ZoomInfo Technologies is 1.43 times more volatile than Enfusion. It trades about -0.03 of its total potential returns per unit of risk. Enfusion is currently generating about 0.01 per unit of volatility. If you would invest  1,106  in Enfusion on September 26, 2024 and sell it today you would lose (54.00) from holding Enfusion or give up 4.88% of portfolio value over 90 days.

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

ZoomInfo Technologies  vs.  Enfusion

ZoomInfo Technologies

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ZoomInfo Technologies are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain forward indicators, ZoomInfo Technologies may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Enfusion

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Enfusion are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile technical and fundamental indicators, Enfusion may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with ZoomInfo Technologies and Enfusion

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

The idea behind ZoomInfo Technologies and Enfusion 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.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.