Correlation Between Godaddy and Akamai Technologies
Can any of the company-specific risk be diversified away by investing in both Godaddy and Akamai Technologies 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 Godaddy and Akamai Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Godaddy and Akamai Technologies, you can compare the effects of market volatilities on Godaddy and Akamai Technologies 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 Godaddy with a short position of Akamai Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Godaddy and Akamai Technologies.
Diversification Opportunities for Godaddy and Akamai Technologies
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Godaddy and Akamai is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Godaddy and Akamai Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akamai Technologies and Godaddy 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 Godaddy are associated (or correlated) with Akamai Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akamai Technologies has no effect on the direction of Godaddy i.e., Godaddy and Akamai Technologies go up and down completely randomly.
Pair Corralation between Godaddy and Akamai Technologies
Given the investment horizon of 90 days Godaddy is expected to generate 0.84 times more return on investment than Akamai Technologies. However, Godaddy is 1.2 times less risky than Akamai Technologies. It trades about -0.04 of its potential returns per unit of risk. Akamai Technologies is currently generating about -0.13 per unit of risk. If you would invest 20,294 in Godaddy on October 20, 2024 and sell it today you would lose (203.00) from holding Godaddy or give up 1.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Godaddy vs. Akamai Technologies
Performance |
| Timeline |
| Godaddy |
| Akamai Technologies |
Godaddy and Akamai Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Godaddy and Akamai Technologies
The main advantage of trading using opposite Godaddy and Akamai Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Godaddy position performs unexpectedly, Akamai Technologies 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 Akamai Technologies will offset losses from the drop in Akamai Technologies' long position.| Godaddy vs. Repay Holdings Corp | Godaddy vs. SPS Commerce | Godaddy vs. Evertec | Godaddy vs. Consensus Cloud Solutions |
| Akamai Technologies vs. Check Point Software | Akamai Technologies vs. VeriSign | Akamai Technologies vs. Qualys Inc | Akamai Technologies vs. F5 Networks |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |