Correlation Between Cetus Protocol and EigenLayer
Can any of the company-specific risk be diversified away by investing in both Cetus Protocol and EigenLayer 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 Cetus Protocol and EigenLayer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cetus Protocol and EigenLayer, you can compare the effects of market volatilities on Cetus Protocol and EigenLayer 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 Cetus Protocol with a short position of EigenLayer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cetus Protocol and EigenLayer.
Diversification Opportunities for Cetus Protocol and EigenLayer
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cetus and EigenLayer is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Cetus Protocol and EigenLayer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EigenLayer and Cetus Protocol 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 Cetus Protocol are associated (or correlated) with EigenLayer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EigenLayer has no effect on the direction of Cetus Protocol i.e., Cetus Protocol and EigenLayer go up and down completely randomly.
Pair Corralation between Cetus Protocol and EigenLayer
Assuming the 90 days trading horizon Cetus Protocol is expected to under-perform the EigenLayer. In addition to that, Cetus Protocol is 1.09 times more volatile than EigenLayer. It trades about -0.44 of its total potential returns per unit of risk. EigenLayer is currently generating about -0.3 per unit of volatility. If you would invest 342.00 in EigenLayer on November 8, 2024 and sell it today you would lose (171.00) from holding EigenLayer or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cetus Protocol vs. EigenLayer
Performance |
| Timeline |
| Cetus Protocol |
| EigenLayer |
Cetus Protocol and EigenLayer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cetus Protocol and EigenLayer
The main advantage of trading using opposite Cetus Protocol and EigenLayer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cetus Protocol position performs unexpectedly, EigenLayer 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 EigenLayer will offset losses from the drop in EigenLayer's long position.| Cetus Protocol vs. XRP | Cetus Protocol vs. Solana | Cetus Protocol vs. Sui | Cetus Protocol vs. Staked Ether |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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