Correlation Between 21Shares Cosmos and 21Shares Polkadot
Can any of the company-specific risk be diversified away by investing in both 21Shares Cosmos and 21Shares Polkadot 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 Cosmos and 21Shares Polkadot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 21Shares Cosmos Staking and 21Shares Polkadot ETP, you can compare the effects of market volatilities on 21Shares Cosmos and 21Shares Polkadot 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 Cosmos with a short position of 21Shares Polkadot. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Cosmos and 21Shares Polkadot.
Diversification Opportunities for 21Shares Cosmos and 21Shares Polkadot
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 21Shares and 21Shares is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Cosmos Staking and 21Shares Polkadot ETP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Polkadot ETP and 21Shares Cosmos 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 Cosmos Staking are associated (or correlated) with 21Shares Polkadot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Polkadot ETP has no effect on the direction of 21Shares Cosmos i.e., 21Shares Cosmos and 21Shares Polkadot go up and down completely randomly.
Pair Corralation between 21Shares Cosmos and 21Shares Polkadot
Assuming the 90 days trading horizon 21Shares Cosmos is expected to generate 28.21 times less return on investment than 21Shares Polkadot. In addition to that, 21Shares Cosmos is 1.03 times more volatile than 21Shares Polkadot ETP. It trades about 0.0 of its total potential returns per unit of risk. 21Shares Polkadot ETP is currently generating about 0.02 per unit of volatility. If you would invest 285.00 in 21Shares Polkadot ETP on August 24, 2024 and sell it today you would lose (8.00) from holding 21Shares Polkadot ETP or give up 2.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 87.72% |
| Values | Daily Returns |
21Shares Cosmos Staking vs. 21Shares Polkadot ETP
Performance |
| Timeline |
| 21Shares Cosmos Staking |
| 21Shares Polkadot ETP |
21Shares Cosmos and 21Shares Polkadot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 21Shares Cosmos and 21Shares Polkadot
The main advantage of trading using opposite 21Shares Cosmos and 21Shares Polkadot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Cosmos position performs unexpectedly, 21Shares Polkadot 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 21Shares Polkadot will offset losses from the drop in 21Shares Polkadot's long position.| 21Shares Cosmos vs. Lyxor UCITS Japan | 21Shares Cosmos vs. Lyxor UCITS Japan | 21Shares Cosmos vs. Lyxor UCITS Stoxx | 21Shares Cosmos vs. Amundi CAC 40 |
| 21Shares Polkadot vs. 21Shares Crypto Basket | 21Shares Polkadot vs. 21Shares Decentraland ETP | 21Shares Polkadot vs. 21Shares Uniswap ETP | 21Shares Polkadot vs. 21Shares Cosmos Staking |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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