Correlation Between BLZ and IoTeX Network
Can any of the company-specific risk be diversified away by investing in both BLZ and IoTeX Network 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 BLZ and IoTeX Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BLZ and IoTeX Network, you can compare the effects of market volatilities on BLZ and IoTeX Network 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 BLZ with a short position of IoTeX Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of BLZ and IoTeX Network.
Diversification Opportunities for BLZ and IoTeX Network
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BLZ and IoTeX is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding BLZ and IoTeX Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IoTeX Network and BLZ 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 BLZ are associated (or correlated) with IoTeX Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IoTeX Network has no effect on the direction of BLZ i.e., BLZ and IoTeX Network go up and down completely randomly.
Pair Corralation between BLZ and IoTeX Network
Assuming the 90 days trading horizon BLZ is expected to generate 1.38 times more return on investment than IoTeX Network. However, BLZ is 1.38 times more volatile than IoTeX Network. It trades about 0.21 of its potential returns per unit of risk. IoTeX Network is currently generating about 0.1 per unit of risk. If you would invest 11.00 in BLZ on August 28, 2024 and sell it today you would earn a total of 3.00 from holding BLZ or generate 27.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BLZ vs. IoTeX Network
Performance |
| Timeline |
| BLZ |
| IoTeX Network |
BLZ and IoTeX Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BLZ and IoTeX Network
The main advantage of trading using opposite BLZ and IoTeX Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BLZ position performs unexpectedly, IoTeX Network 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 IoTeX Network will offset losses from the drop in IoTeX Network's long position.The idea behind BLZ and IoTeX Network 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.| IoTeX Network vs. Staked Ether | IoTeX Network vs. EigenLayer | IoTeX Network vs. EOSDAC | IoTeX Network vs. BLZ |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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