Correlation Between Hedera Hashgraph and Avalanche
Can any of the company-specific risk be diversified away by investing in both Hedera Hashgraph and Avalanche 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 Hedera Hashgraph and Avalanche into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hedera Hashgraph and Avalanche, you can compare the effects of market volatilities on Hedera Hashgraph and Avalanche 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 Hedera Hashgraph with a short position of Avalanche. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hedera Hashgraph and Avalanche.
Diversification Opportunities for Hedera Hashgraph and Avalanche
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hedera and Avalanche is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Hedera Hashgraph and Avalanche in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avalanche and Hedera Hashgraph 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 Hedera Hashgraph are associated (or correlated) with Avalanche. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avalanche has no effect on the direction of Hedera Hashgraph i.e., Hedera Hashgraph and Avalanche go up and down completely randomly.
Pair Corralation between Hedera Hashgraph and Avalanche
Assuming the 90 days trading horizon Hedera Hashgraph is expected to generate 1.22 times less return on investment than Avalanche. But when comparing it to its historical volatility, Hedera Hashgraph is 1.42 times less risky than Avalanche. It trades about 0.07 of its potential returns per unit of risk. Avalanche is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,341 in Avalanche on August 23, 2024 and sell it today you would earn a total of 2,012 from holding Avalanche or generate 150.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hedera Hashgraph vs. Avalanche
Performance |
| Timeline |
| Hedera Hashgraph |
| Avalanche |
Hedera Hashgraph and Avalanche Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hedera Hashgraph and Avalanche
The main advantage of trading using opposite Hedera Hashgraph and Avalanche positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hedera Hashgraph position performs unexpectedly, Avalanche 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 Avalanche will offset losses from the drop in Avalanche's long position.| Hedera Hashgraph vs. Staked Ether | Hedera Hashgraph vs. EigenLayer | Hedera Hashgraph vs. EOSDAC | Hedera Hashgraph 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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