Correlation Between NextPlat Corp and ZoomInfo Technologies

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

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

Diversification Opportunities for NextPlat Corp and ZoomInfo Technologies

-0.29

Correlation Coefficient

NextPlat Corp  ZoomInfo Technologies

Very good diversification

The 3 months correlation between NextPlat and ZoomInfo is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding NextPlat Corp and ZoomInfo Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZoomInfo Technologies and NextPlat Corp 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 NextPlat Corp are associated (or correlated) with ZoomInfo Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZoomInfo Technologies has no effect on the direction of NextPlat Corp i.e., NextPlat Corp and ZoomInfo Technologies go up and down completely randomly.

Pair Corralation between NextPlat Corp and ZoomInfo Technologies

Assuming the 90 days horizon NextPlat Corp is expected to under-perform the ZoomInfo Technologies. In addition to that, NextPlat Corp is 2.08 times more volatile than ZoomInfo Technologies. It trades about -0.06 of its total potential returns per unit of risk. ZoomInfo Technologies is currently generating about 0.06 per unit of volatility. If you would invest  992.00  in ZoomInfo Technologies on September 2, 2024 and sell it today you would earn a total of  102.00  from holding ZoomInfo Technologies or generate 10.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	75.0%
Values	Daily Returns

NextPlat Corp  vs.  ZoomInfo Technologies

NextPlat Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NextPlat Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's essential indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

ZoomInfo Technologies

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ZoomInfo Technologies are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, ZoomInfo Technologies demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NextPlat Corp and ZoomInfo Technologies

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

The idea behind NextPlat Corp and ZoomInfo Technologies 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.