Correlation Between Crypto and Appen
Can any of the company-specific risk be diversified away by investing in both Crypto and Appen 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 Crypto and Appen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crypto Co and Appen Limited, you can compare the effects of market volatilities on Crypto and Appen 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 Crypto with a short position of Appen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crypto and Appen.
Diversification Opportunities for Crypto and Appen
Very good diversification
The 3 months correlation between Crypto and Appen is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Crypto Co and Appen Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Appen Limited and Crypto 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 Crypto Co are associated (or correlated) with Appen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Appen Limited has no effect on the direction of Crypto i.e., Crypto and Appen go up and down completely randomly.
Pair Corralation between Crypto and Appen
Given the investment horizon of 90 days Crypto Co is expected to generate 2.62 times more return on investment than Appen. However, Crypto is 2.62 times more volatile than Appen Limited. It trades about 0.02 of its potential returns per unit of risk. Appen Limited is currently generating about -0.02 per unit of risk. If you would invest 0.10 in Crypto Co on November 4, 2024 and sell it today you would lose (0.03) from holding Crypto Co or give up 30.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Crypto Co vs. Appen Limited
Performance |
| Timeline |
| Crypto |
| Appen Limited |
Crypto and Appen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crypto and Appen
The main advantage of trading using opposite Crypto and Appen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crypto position performs unexpectedly, Appen 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 Appen will offset losses from the drop in Appen's long position.| Crypto vs. Direct Communication Solutions | Crypto vs. Datametrex AI Limited | Crypto vs. CSE Global Limited | Crypto vs. Appen Limited |
| Appen vs. Atos Origin SA | Appen vs. Aurora Innovation | Appen vs. Appen Limited | Appen vs. Direct Communication Solutions |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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