Correlation Between CarMax and ZoomInfo Technologies

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

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

Diversification Opportunities for CarMax and ZoomInfo Technologies

-0.33

Correlation Coefficient

CarMax  ZoomInfo Technologies

Very good diversification

The 3 months correlation between CarMax and ZoomInfo is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding CarMax Inc and ZoomInfo Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZoomInfo Technologies and CarMax 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 CarMax Inc 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 CarMax i.e., CarMax and ZoomInfo Technologies go up and down completely randomly.

Pair Corralation between CarMax and ZoomInfo Technologies

Considering the 90-day investment horizon CarMax Inc is expected to under-perform the ZoomInfo Technologies. But the stock apears to be less risky and, when comparing its historical volatility, CarMax Inc is 1.17 times less risky than ZoomInfo Technologies. The stock trades about -0.12 of its potential returns per unit of risk. The ZoomInfo Technologies is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  889.00  in ZoomInfo Technologies on May 6, 2025 and sell it today you would earn a total of  132.00  from holding ZoomInfo Technologies or generate 14.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

CarMax Inc  vs.  ZoomInfo Technologies

CarMax Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days CarMax Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's primary indicators remain fairly strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

ZoomInfo Technologies

Risk-Adjusted Performance

Modest

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

Pair Trading with CarMax and ZoomInfo Technologies

The main advantage of trading using opposite CarMax and ZoomInfo Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CarMax 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 CarMax Inc 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.