Correlation Between Hub Cyber and ZeroFox Holdings

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

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

Diversification Opportunities for Hub Cyber and ZeroFox Holdings

0.05

Correlation Coefficient

Hub Cyber  ZeroFox Holdings

Significant diversification

The 3 months correlation between Hub and ZeroFox is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Hub Cyber Security and ZeroFox Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZeroFox Holdings and Hub Cyber 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 Hub Cyber Security 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 Hub Cyber i.e., Hub Cyber and ZeroFox Holdings go up and down completely randomly.

Pair Corralation between Hub Cyber and ZeroFox Holdings

If you would invest  45.00  in Hub Cyber Security on August 30, 2024 and sell it today you would earn a total of  6.75  from holding Hub Cyber Security or generate 15.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Hub Cyber Security  vs.  ZeroFox Holdings

Hub Cyber Security

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hub Cyber Security are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental drivers, Hub Cyber may actually be approaching a critical reversion point that can send shares even higher in December 2024.

ZeroFox Holdings

Risk-Adjusted Performance

0 of 100

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.

Pair Trading with Hub Cyber and ZeroFox Holdings

The main advantage of trading using opposite Hub Cyber and ZeroFox Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hub Cyber 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 Hub Cyber Security 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.