Correlation Between Binance Coin and Gentera SAB

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Can any of the company-specific risk be diversified away by investing in both Binance Coin and Gentera SAB 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 Binance Coin and Gentera SAB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binance Coin and Gentera SAB de, you can compare the effects of market volatilities on Binance Coin and Gentera SAB 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 Binance Coin with a short position of Gentera SAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binance Coin and Gentera SAB.

Diversification Opportunities for Binance Coin and Gentera SAB

0.09
  Correlation Coefficient

Significant diversification

The 3 months correlation between Binance and Gentera is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Binance Coin and Gentera SAB de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentera SAB de and Binance Coin 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 Binance Coin are associated (or correlated) with Gentera SAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentera SAB de has no effect on the direction of Binance Coin i.e., Binance Coin and Gentera SAB go up and down completely randomly.

Pair Corralation between Binance Coin and Gentera SAB

Assuming the 90 days trading horizon Binance Coin is expected to generate 1.25 times less return on investment than Gentera SAB. In addition to that, Binance Coin is 1.29 times more volatile than Gentera SAB de. It trades about 0.11 of its total potential returns per unit of risk. Gentera SAB de is currently generating about 0.18 per unit of volatility. If you would invest  1,970  in Gentera SAB de on November 2, 2024 and sell it today you would earn a total of  898.00  from holding Gentera SAB de or generate 45.58% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy96.26%
ValuesDaily Returns

Binance Coin  vs.  Gentera SAB de

 Performance 
       Timeline  
Binance Coin 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Binance Coin are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental drivers, Binance Coin exhibited solid returns over the last few months and may actually be approaching a breakup point.
Gentera SAB de 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Gentera SAB de are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Gentera SAB sustained solid returns over the last few months and may actually be approaching a breakup point.

Binance Coin and Gentera SAB Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Binance Coin and Gentera SAB

The main advantage of trading using opposite Binance Coin and Gentera SAB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binance Coin position performs unexpectedly, Gentera SAB 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 Gentera SAB will offset losses from the drop in Gentera SAB's long position.
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The idea behind Binance Coin and Gentera SAB de 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.
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.

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