Correlation Between Athena Bitcoin and Morgan Stanley
Can any of the company-specific risk be diversified away by investing in both Athena Bitcoin and Morgan Stanley 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 Athena Bitcoin and Morgan Stanley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Athena Bitcoin Global and Morgan Stanley, you can compare the effects of market volatilities on Athena Bitcoin and Morgan Stanley 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 Athena Bitcoin with a short position of Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athena Bitcoin and Morgan Stanley.
Diversification Opportunities for Athena Bitcoin and Morgan Stanley
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Athena and Morgan is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Athena Bitcoin Global and Morgan Stanley in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley and Athena Bitcoin 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 Athena Bitcoin Global are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley has no effect on the direction of Athena Bitcoin i.e., Athena Bitcoin and Morgan Stanley go up and down completely randomly.
Pair Corralation between Athena Bitcoin and Morgan Stanley
Given the investment horizon of 90 days Athena Bitcoin Global is expected to generate 10.51 times more return on investment than Morgan Stanley. However, Athena Bitcoin is 10.51 times more volatile than Morgan Stanley. It trades about 0.3 of its potential returns per unit of risk. Morgan Stanley is currently generating about 0.22 per unit of risk. If you would invest 2.60 in Athena Bitcoin Global on August 28, 2024 and sell it today you would earn a total of 6.51 from holding Athena Bitcoin Global or generate 250.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athena Bitcoin Global vs. Morgan Stanley
Performance |
| Timeline |
| Athena Bitcoin Global |
| Morgan Stanley |
Athena Bitcoin and Morgan Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Athena Bitcoin and Morgan Stanley
The main advantage of trading using opposite Athena Bitcoin and Morgan Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athena Bitcoin position performs unexpectedly, Morgan Stanley 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 Morgan Stanley will offset losses from the drop in Morgan Stanley's long position.| Athena Bitcoin vs. Morgan Stanley | Athena Bitcoin vs. Goldman Sachs Group | Athena Bitcoin vs. Charles Schwab Corp | Athena Bitcoin vs. Interactive Brokers Group |
| Morgan Stanley vs. Goldman Sachs Group | Morgan Stanley vs. Riot Blockchain | Morgan Stanley vs. Marathon Digital Holdings | Morgan Stanley vs. Applied Blockchain |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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