Correlation Between Cardano and SAI Old
Can any of the company-specific risk be diversified away by investing in both Cardano and SAI Old 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 Cardano and SAI Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardano and SAI Old, you can compare the effects of market volatilities on Cardano and SAI Old 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 Cardano with a short position of SAI Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardano and SAI Old.
Diversification Opportunities for Cardano and SAI Old
Very good diversification
The 3 months correlation between Cardano and SAI is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Cardano and SAI Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAI Old and Cardano 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 Cardano are associated (or correlated) with SAI Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAI Old has no effect on the direction of Cardano i.e., Cardano and SAI Old go up and down completely randomly.
Pair Corralation between Cardano and SAI Old
Assuming the 90 days trading horizon Cardano is expected to generate 1.16 times less return on investment than SAI Old. But when comparing it to its historical volatility, Cardano is 2.33 times less risky than SAI Old. It trades about 0.08 of its potential returns per unit of risk. SAI Old is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 138.00 in SAI Old on October 12, 2024 and sell it today you would lose (21.00) from holding SAI Old or give up 15.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 64.85% |
| Values | Daily Returns |
Cardano vs. SAI Old
Performance |
| Timeline |
| Cardano |
| SAI Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Cardano and SAI Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardano and SAI Old
The main advantage of trading using opposite Cardano and SAI Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardano position performs unexpectedly, SAI Old 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 SAI Old will offset losses from the drop in SAI Old's long position.The idea behind Cardano and SAI Old 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.| SAI Old vs. Zhong Yang Financial | SAI Old vs. Netcapital | SAI Old vs. Magic Empire Global | SAI Old vs. Applied Digital |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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