Correlation Between Godaddy and Toast
Can any of the company-specific risk be diversified away by investing in both Godaddy and Toast 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 Godaddy and Toast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Godaddy and Toast Inc, you can compare the effects of market volatilities on Godaddy and Toast 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 Godaddy with a short position of Toast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Godaddy and Toast.
Diversification Opportunities for Godaddy and Toast
Very poor diversification
The 3 months correlation between Godaddy and Toast is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Godaddy and Toast Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Toast Inc and Godaddy 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 Godaddy are associated (or correlated) with Toast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Toast Inc has no effect on the direction of Godaddy i.e., Godaddy and Toast go up and down completely randomly.
Pair Corralation between Godaddy and Toast
Given the investment horizon of 90 days Godaddy is expected to under-perform the Toast. But the stock apears to be less risky and, when comparing its historical volatility, Godaddy is 1.3 times less risky than Toast. The stock trades about -0.13 of its potential returns per unit of risk. The Toast Inc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 3,610 in Toast Inc on July 24, 2025 and sell it today you would earn a total of 245.00 from holding Toast Inc or generate 6.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Godaddy vs. Toast Inc
Performance |
| Timeline |
| Godaddy |
| Toast Inc |
Godaddy and Toast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Godaddy and Toast
The main advantage of trading using opposite Godaddy and Toast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Godaddy position performs unexpectedly, Toast 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 Toast will offset losses from the drop in Toast's long position.| Godaddy vs. Gen Digital | Godaddy vs. F5 Networks | Godaddy vs. Corpay Inc | Godaddy vs. Check Point Software |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |