Correlation Between CiT and ZeroFox Holdings

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Can any of the company-specific risk be diversified away by investing in both CiT and ZeroFox Holdings 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 CiT and ZeroFox Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CiT Inc and ZeroFox Holdings, you can compare the effects of market volatilities on CiT and ZeroFox Holdings 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 CiT with a short position of ZeroFox Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of CiT and ZeroFox Holdings.

Diversification Opportunities for CiT and ZeroFox Holdings

-0.5
  Correlation Coefficient

Very good diversification

The 3 months correlation between CiT and ZeroFox is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding CiT Inc and ZeroFox Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZeroFox Holdings and CiT 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 CiT Inc are associated (or correlated) with ZeroFox Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZeroFox Holdings has no effect on the direction of CiT i.e., CiT and ZeroFox Holdings go up and down completely randomly.

Pair Corralation between CiT and ZeroFox Holdings

If you would invest  118.00  in ZeroFox Holdings on September 17, 2024 and sell it today you would earn a total of  0.00  from holding ZeroFox Holdings or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy1.54%
ValuesDaily Returns

CiT Inc  vs.  ZeroFox Holdings

 Performance 
       Timeline  
CiT Inc 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CiT Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CiT is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.
ZeroFox Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ZeroFox Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, ZeroFox Holdings is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

CiT and ZeroFox Holdings Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CiT and ZeroFox Holdings

The main advantage of trading using opposite CiT and ZeroFox Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CiT position performs unexpectedly, ZeroFox Holdings 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 ZeroFox Holdings will offset losses from the drop in ZeroFox Holdings' long position.
The idea behind CiT Inc and ZeroFox Holdings 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.

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