Correlation Between Zoomcar Holdings and Nasdaq

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

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

Diversification Opportunities for Zoomcar Holdings and Nasdaq

0.15

Correlation Coefficient

Zoomcar Holdings  Nasdaq

Average diversification

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

Pair Corralation between Zoomcar Holdings and Nasdaq

Assuming the 90 days horizon Zoomcar Holdings is expected to generate 28.91 times more return on investment than Nasdaq. However, Zoomcar Holdings is 28.91 times more volatile than Nasdaq Inc. It trades about 0.1 of its potential returns per unit of risk. Nasdaq Inc is currently generating about 0.18 per unit of risk. If you would invest  1.63  in Zoomcar Holdings on September 12, 2024 and sell it today you would lose (0.41) from holding Zoomcar Holdings or give up 25.15% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	92.06%
Values	Daily Returns

Zoomcar Holdings  vs.  Nasdaq Inc

Zoomcar Holdings

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Zoomcar Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Zoomcar Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Nasdaq Inc

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq Inc are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Nasdaq may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Zoomcar Holdings and Nasdaq

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

The idea behind Zoomcar Holdings and Nasdaq Inc 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.