Correlation Between Cardano and International Fund
Can any of the company-specific risk be diversified away by investing in both Cardano and International Fund 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 International Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardano and International Fund International, you can compare the effects of market volatilities on Cardano and International Fund 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 International Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardano and International Fund.
Diversification Opportunities for Cardano and International Fund
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cardano and International is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Cardano and International Fund Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Fund 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 International Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Fund has no effect on the direction of Cardano i.e., Cardano and International Fund go up and down completely randomly.
Pair Corralation between Cardano and International Fund
Assuming the 90 days trading horizon Cardano is expected to generate 7.31 times more return on investment than International Fund. However, Cardano is 7.31 times more volatile than International Fund International. It trades about 0.09 of its potential returns per unit of risk. International Fund International is currently generating about 0.04 per unit of risk. If you would invest 39.00 in Cardano on October 21, 2024 and sell it today you would earn a total of 71.00 from holding Cardano or generate 182.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 60.28% |
| Values | Daily Returns |
Cardano vs. International Fund Internation
Performance |
| Timeline |
| Cardano |
| International Fund |
Cardano and International Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardano and International Fund
The main advantage of trading using opposite Cardano and International Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardano position performs unexpectedly, International Fund 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 International Fund will offset losses from the drop in International Fund's long position.The idea behind Cardano and International Fund International 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.| International Fund vs. Ab Global Bond | International Fund vs. Qs Global Equity | International Fund vs. Rbc Global Equity | International Fund vs. Federated Global Allocation |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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