Correlation Between GigaCloud Technology and Zeta Global

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

By analyzing existing cross correlation between GigaCloud Technology Class and Zeta Global Holdings, you can compare the effects of market volatilities on GigaCloud Technology and Zeta Global 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 GigaCloud Technology with a short position of Zeta Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of GigaCloud Technology and Zeta Global.

Diversification Opportunities for GigaCloud Technology and Zeta Global

0.17

Correlation Coefficient

GigaCloud Technology  Zeta Global

Average diversification

The 3 months correlation between GigaCloud and Zeta is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding GigaCloud Technology Class and Zeta Global Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zeta Global Holdings and GigaCloud Technology 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 GigaCloud Technology Class are associated (or correlated) with Zeta Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zeta Global Holdings has no effect on the direction of GigaCloud Technology i.e., GigaCloud Technology and Zeta Global go up and down completely randomly.

Pair Corralation between GigaCloud Technology and Zeta Global

Considering the 90-day investment horizon GigaCloud Technology Class is expected to generate 0.81 times more return on investment than Zeta Global. However, GigaCloud Technology Class is 1.23 times less risky than Zeta Global. It trades about 0.09 of its potential returns per unit of risk. Zeta Global Holdings is currently generating about 0.01 per unit of risk. If you would invest  1,849  in GigaCloud Technology Class on September 11, 2024 and sell it today you would earn a total of  467.00  from holding GigaCloud Technology Class or generate 25.26% return on investment over 90 days.

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

GigaCloud Technology Class  vs.  Zeta Global Holdings

GigaCloud Technology

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in GigaCloud Technology Class are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak fundamental indicators, GigaCloud Technology unveiled solid returns over the last few months and may actually be approaching a breakup point.

Zeta Global Holdings

Risk-Adjusted Performance

1 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Zeta Global Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Zeta Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with GigaCloud Technology and Zeta Global

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

The idea behind GigaCloud Technology Class and Zeta Global 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.