Correlation Between SAP SE and Voice Assist

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

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

Diversification Opportunities for SAP SE and Voice Assist

-0.32

Correlation Coefficient

SAP SE  Voice Assist

Very good diversification

The 3 months correlation between SAP and Voice is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding SAP SE and Voice Assist in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voice Assist and SAP SE 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 SAP SE are associated (or correlated) with Voice Assist. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voice Assist has no effect on the direction of SAP SE i.e., SAP SE and Voice Assist go up and down completely randomly.

Pair Corralation between SAP SE and Voice Assist

Assuming the 90 days horizon SAP SE is expected to generate 41.92 times less return on investment than Voice Assist. But when comparing it to its historical volatility, SAP SE is 5.59 times less risky than Voice Assist. It trades about 0.0 of its potential returns per unit of risk. Voice Assist is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  0.93  in Voice Assist on May 1, 2025 and sell it today you would lose (0.03) from holding Voice Assist or give up 3.23% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

SAP SE  vs.  Voice Assist

SAP SE

Risk-Adjusted Performance

Very Weak

Over the last 90 days SAP SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, SAP SE is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Voice Assist

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Voice Assist are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Voice Assist unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SAP SE and Voice Assist

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

The idea behind SAP SE and Voice Assist 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.