Correlation Between Armada Mercantile and BitFrontier Capital
Can any of the company-specific risk be diversified away by investing in both Armada Mercantile and BitFrontier Capital 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 Armada Mercantile and BitFrontier Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Mercantile and BitFrontier Capital Holdings, you can compare the effects of market volatilities on Armada Mercantile and BitFrontier Capital 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 Armada Mercantile with a short position of BitFrontier Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Mercantile and BitFrontier Capital.
Diversification Opportunities for Armada Mercantile and BitFrontier Capital
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Armada and BitFrontier is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Armada Mercantile and BitFrontier Capital Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BitFrontier Capital and Armada Mercantile 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 Armada Mercantile are associated (or correlated) with BitFrontier Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BitFrontier Capital has no effect on the direction of Armada Mercantile i.e., Armada Mercantile and BitFrontier Capital go up and down completely randomly.
Pair Corralation between Armada Mercantile and BitFrontier Capital
Assuming the 90 days horizon Armada Mercantile is expected to generate 1.04 times less return on investment than BitFrontier Capital. But when comparing it to its historical volatility, Armada Mercantile is 1.74 times less risky than BitFrontier Capital. It trades about 0.03 of its potential returns per unit of risk. BitFrontier Capital Holdings is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2.10 in BitFrontier Capital Holdings on September 1, 2024 and sell it today you would lose (1.82) from holding BitFrontier Capital Holdings or give up 86.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.56% |
| Values | Daily Returns |
Armada Mercantile vs. BitFrontier Capital Holdings
Performance |
| Timeline |
| Armada Mercantile |
| BitFrontier Capital |
Armada Mercantile and BitFrontier Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Mercantile and BitFrontier Capital
The main advantage of trading using opposite Armada Mercantile and BitFrontier Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Mercantile position performs unexpectedly, BitFrontier Capital 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 BitFrontier Capital will offset losses from the drop in BitFrontier Capital's long position.| Armada Mercantile vs. SPENN Technology AS | Armada Mercantile vs. Arcane Crypto AB | Armada Mercantile vs. OFX Group Ltd | Armada Mercantile vs. Blockmate Ventures |
| BitFrontier Capital vs. XTRA Bitcoin | BitFrontier Capital vs. Coin Citadel | BitFrontier Capital vs. Dmg Blockchain Solutions | BitFrontier Capital vs. Argo Blockchain PLC |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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