Correlation Between Stem and ZeroFox Holdings
Can any of the company-specific risk be diversified away by investing in both Stem 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 Stem and ZeroFox Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stem Inc and ZeroFox Holdings, you can compare the effects of market volatilities on Stem 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 Stem with a short position of ZeroFox Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stem and ZeroFox Holdings.
Diversification Opportunities for Stem and ZeroFox Holdings
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Stem and ZeroFox is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Stem Inc and ZeroFox Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZeroFox Holdings and Stem 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 Stem Inc 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 Stem i.e., Stem and ZeroFox Holdings go up and down completely randomly.
Pair Corralation between Stem and ZeroFox Holdings
If you would invest 32.00 in Stem Inc on October 22, 2024 and sell it today you would earn a total of 38.10 from holding Stem Inc or generate 119.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Stem Inc vs. ZeroFox Holdings
Performance |
| Timeline |
| Stem Inc |
| ZeroFox Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Stem and ZeroFox Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stem and ZeroFox Holdings
The main advantage of trading using opposite Stem and ZeroFox Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stem 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.| Stem vs. Palo Alto Networks | Stem vs. Crowdstrike Holdings | Stem vs. Cloudflare | Stem vs. Palantir Technologies Class |
| ZeroFox Holdings vs. Hub Cyber Security | ZeroFox Holdings vs. authID Inc | ZeroFox Holdings vs. VirnetX Holding Corp | ZeroFox Holdings vs. Aurora Mobile |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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