Correlation Between Pagaya Technologies and Zeta Global

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

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

Diversification Opportunities for Pagaya Technologies and Zeta Global

0.52

Correlation Coefficient

Pagaya Technologies  Zeta Global

Very weak diversification

The 3 months correlation between Pagaya and Zeta is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Pagaya Technologies 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 Pagaya 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 Pagaya Technologies 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 Pagaya Technologies i.e., Pagaya Technologies and Zeta Global go up and down completely randomly.

Pair Corralation between Pagaya Technologies and Zeta Global

Considering the 90-day investment horizon Pagaya Technologies is expected to under-perform the Zeta Global. In addition to that, Pagaya Technologies is 1.01 times more volatile than Zeta Global Holdings. It trades about 0.0 of its total potential returns per unit of risk. Zeta Global Holdings is currently generating about 0.01 per unit of volatility. If you would invest  2,619  in Zeta Global Holdings on September 11, 2024 and sell it today you would lose (322.00) from holding Zeta Global Holdings or give up 12.29% of portfolio value over 90 days.

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

Pagaya Technologies  vs.  Zeta Global Holdings

Pagaya Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

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

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 Pagaya Technologies and Zeta Global

The main advantage of trading using opposite Pagaya Technologies and Zeta Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pagaya Technologies 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 Pagaya Technologies 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.