Correlation Between ZoomInfo Technologies and Trade Desk

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

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

Diversification Opportunities for ZoomInfo Technologies and Trade Desk

-0.65

Correlation Coefficient

ZoomInfo Technologies  Trade Desk

Excellent diversification

The 3 months correlation between ZoomInfo and Trade is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding ZoomInfo Technologies and Trade Desk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Desk and ZoomInfo 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 ZoomInfo Technologies are associated (or correlated) with Trade Desk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Desk has no effect on the direction of ZoomInfo Technologies i.e., ZoomInfo Technologies and Trade Desk go up and down completely randomly.

Pair Corralation between ZoomInfo Technologies and Trade Desk

Allowing for the 90-day total investment horizon ZoomInfo Technologies is expected to under-perform the Trade Desk. In addition to that, ZoomInfo Technologies is 1.7 times more volatile than Trade Desk. It trades about -0.1 of its total potential returns per unit of risk. Trade Desk is currently generating about 0.09 per unit of volatility. If you would invest  8,345  in Trade Desk on March 4, 2024 and sell it today you would earn a total of  933.00  from holding Trade Desk or generate 11.18% return on investment over 90 days.

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

ZoomInfo Technologies  vs.  Trade Desk

ZoomInfo Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ZoomInfo Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in July 2024. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Trade Desk

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Trade Desk are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal basic indicators, Trade Desk may actually be approaching a critical reversion point that can send shares even higher in July 2024.

Pair Trading with ZoomInfo Technologies and Trade Desk

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

The idea behind ZoomInfo Technologies and Trade Desk 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.

Check out your portfolio center.

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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.