Correlation Between 21Shares Polkadot and ZKB Gold
Can any of the company-specific risk be diversified away by investing in both 21Shares Polkadot and ZKB Gold 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 21Shares Polkadot and ZKB Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 21Shares Polkadot ETP and ZKB Gold ETF, you can compare the effects of market volatilities on 21Shares Polkadot and ZKB Gold 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 21Shares Polkadot with a short position of ZKB Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Polkadot and ZKB Gold.
Diversification Opportunities for 21Shares Polkadot and ZKB Gold
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between 21Shares and ZKB is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Polkadot ETP and ZKB Gold ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKB Gold ETF and 21Shares Polkadot 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 21Shares Polkadot ETP are associated (or correlated) with ZKB Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKB Gold ETF has no effect on the direction of 21Shares Polkadot i.e., 21Shares Polkadot and ZKB Gold go up and down completely randomly.
Pair Corralation between 21Shares Polkadot and ZKB Gold
Assuming the 90 days trading horizon 21Shares Polkadot ETP is expected to generate 9.04 times more return on investment than ZKB Gold. However, 21Shares Polkadot is 9.04 times more volatile than ZKB Gold ETF. It trades about 0.24 of its potential returns per unit of risk. ZKB Gold ETF is currently generating about 0.02 per unit of risk. If you would invest 215.00 in 21Shares Polkadot ETP on September 13, 2024 and sell it today you would earn a total of 247.00 from holding 21Shares Polkadot ETP or generate 114.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
21Shares Polkadot ETP vs. ZKB Gold ETF
Performance |
| Timeline |
| 21Shares Polkadot ETP |
| ZKB Gold ETF |
21Shares Polkadot and ZKB Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 21Shares Polkadot and ZKB Gold
The main advantage of trading using opposite 21Shares Polkadot and ZKB Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Polkadot position performs unexpectedly, ZKB Gold 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 ZKB Gold will offset losses from the drop in ZKB Gold's long position.| 21Shares Polkadot vs. 21Shares Polygon ETP | 21Shares Polkadot vs. 21Shares Ethereum Core | 21Shares Polkadot vs. 21Shares Tezos staking | 21Shares Polkadot vs. 21Shares Bitcoin ETP |
| ZKB Gold vs. Baloise Holding AG | ZKB Gold vs. 21Shares Polkadot ETP | ZKB Gold vs. UBS ETF MSCI | ZKB Gold vs. BB Biotech AG |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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