Correlation Between Cardano and SUPERC
Can any of the company-specific risk be diversified away by investing in both Cardano and SUPERC 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 SUPERC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardano and SUPERC, you can compare the effects of market volatilities on Cardano and SUPERC 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 SUPERC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardano and SUPERC.
Diversification Opportunities for Cardano and SUPERC
Very good diversification
The 3 months correlation between Cardano and SUPERC is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Cardano and SUPERC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUPERC 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 SUPERC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUPERC has no effect on the direction of Cardano i.e., Cardano and SUPERC go up and down completely randomly.
Pair Corralation between Cardano and SUPERC
Assuming the 90 days trading horizon Cardano is expected to generate 1.31 times more return on investment than SUPERC. However, Cardano is 1.31 times more volatile than SUPERC. It trades about 0.1 of its potential returns per unit of risk. SUPERC is currently generating about 0.03 per unit of risk. If you would invest 31.00 in Cardano on August 27, 2024 and sell it today you would earn a total of 76.00 from holding Cardano or generate 245.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 55.18% |
| Values | Daily Returns |
Cardano vs. SUPERC
Performance |
| Timeline |
| Cardano |
| SUPERC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cardano and SUPERC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardano and SUPERC
The main advantage of trading using opposite Cardano and SUPERC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardano position performs unexpectedly, SUPERC 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 SUPERC will offset losses from the drop in SUPERC's long position.The idea behind Cardano and SUPERC 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.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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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