Correlation Between Pagaya Technologies and Cerberus Cyber

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

By analyzing existing cross correlation between Pagaya Technologies Ltd and Cerberus Cyber Sentinel, you can compare the effects of market volatilities on Pagaya Technologies and Cerberus Cyber 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 Cerberus Cyber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pagaya Technologies and Cerberus Cyber.

Diversification Opportunities for Pagaya Technologies and Cerberus Cyber

0.15

Correlation Coefficient

Pagaya Technologies  Cerberus Cyber

Average diversification

The 3 months correlation between Pagaya and Cerberus is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Pagaya Technologies Ltd and Cerberus Cyber Sentinel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cerberus Cyber Sentinel 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 Ltd are associated (or correlated) with Cerberus Cyber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cerberus Cyber Sentinel has no effect on the direction of Pagaya Technologies i.e., Pagaya Technologies and Cerberus Cyber go up and down completely randomly.

Pair Corralation between Pagaya Technologies and Cerberus Cyber

Assuming the 90 days horizon Pagaya Technologies Ltd is expected to generate 0.0 times more return on investment than Cerberus Cyber. However, Pagaya Technologies Ltd is 1970.38 times less risky than Cerberus Cyber. It trades about 0.13 of its potential returns per unit of risk. Cerberus Cyber Sentinel is currently generating about -0.14 per unit of risk. If you would invest  23.00  in Pagaya Technologies Ltd on December 21, 2024 and sell it today you would earn a total of  0.01  from holding Pagaya Technologies Ltd or generate 0.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

Pagaya Technologies Ltd  vs.  Cerberus Cyber Sentinel

Pagaya Technologies

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pagaya Technologies Ltd are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Pagaya Technologies is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Cerberus Cyber Sentinel

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cerberus Cyber Sentinel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Pagaya Technologies and Cerberus Cyber

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

The idea behind Pagaya Technologies Ltd and Cerberus Cyber Sentinel 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.