Correlation Between EM and Swell Network

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

Diversification Opportunities for EM and Swell Network

EMSwellDiversified AwayEMSwellDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between EM and Swell is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EM and Swell Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swell Network and EM 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 EM are associated (or correlated) with Swell Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swell Network has no effect on the direction of EM i.e., EM and Swell Network go up and down completely randomly.

Pair Corralation between EM and Swell Network

If you would invest  0.01  in EM on November 23, 2024 and sell it today you would earn a total of  0.00  from holding EM or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy95.65%
ValuesDaily Returns

EM  vs.  Swell Network

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 20,000,000,000,000,00040,000,000,000,000,00060,000,000,000,000,00080,000,000,000,000,000
JavaScript chart by amCharts 3.21.15EM SWELL
       Timeline  
EM 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days EM has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, EM is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.00010.0001050.000110.000115
Swell Network 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Swell Network are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Swell Network exhibited solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb

EM and Swell Network Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15 0.0020.0040.0060.008
JavaScript chart by amCharts 3.21.15EM SWELL
       Returns  

Pair Trading with EM and Swell Network

The main advantage of trading using opposite EM and Swell Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EM position performs unexpectedly, Swell 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 Swell Network will offset losses from the drop in Swell Network's long position.
The idea behind EM and Swell 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.
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

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