Correlation Between 21Shares Crypto and 21Shares Uniswap
Can any of the company-specific risk be diversified away by investing in both 21Shares Crypto and 21Shares Uniswap 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 21Shares Crypto and 21Shares Uniswap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 21Shares Crypto Basket and 21Shares Uniswap ETP, you can compare the effects of market volatilities on 21Shares Crypto and 21Shares Uniswap 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 21Shares Crypto with a short position of 21Shares Uniswap. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Crypto and 21Shares Uniswap.
Diversification Opportunities for 21Shares Crypto and 21Shares Uniswap
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 21Shares and 21Shares is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Crypto Basket and 21Shares Uniswap ETP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Uniswap ETP and 21Shares 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 21Shares Crypto Basket are associated (or correlated) with 21Shares Uniswap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Uniswap ETP has no effect on the direction of 21Shares Crypto i.e., 21Shares Crypto and 21Shares Uniswap go up and down completely randomly.
Pair Corralation between 21Shares Crypto and 21Shares Uniswap
Assuming the 90 days trading horizon 21Shares Crypto is expected to generate 1.22 times less return on investment than 21Shares Uniswap. But when comparing it to its historical volatility, 21Shares Crypto Basket is 1.95 times less risky than 21Shares Uniswap. It trades about 0.08 of its potential returns per unit of risk. 21Shares Uniswap ETP is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,567 in 21Shares Uniswap ETP on September 1, 2024 and sell it today you would earn a total of 317.00 from holding 21Shares Uniswap ETP or generate 20.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
21Shares Crypto Basket vs. 21Shares Uniswap ETP
Performance |
| Timeline |
| 21Shares Crypto Basket |
| 21Shares Uniswap ETP |
21Shares Crypto and 21Shares Uniswap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 21Shares Crypto and 21Shares Uniswap
The main advantage of trading using opposite 21Shares Crypto and 21Shares Uniswap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Crypto position performs unexpectedly, 21Shares Uniswap 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 21Shares Uniswap will offset losses from the drop in 21Shares Uniswap's long position.| 21Shares Crypto vs. Lyxor UCITS Japan | 21Shares Crypto vs. Lyxor UCITS Japan | 21Shares Crypto vs. Lyxor UCITS Stoxx | 21Shares Crypto vs. Amundi CAC 40 |
| 21Shares Uniswap vs. 21Shares Crypto Basket | 21Shares Uniswap vs. 21Shares Decentraland ETP | 21Shares Uniswap vs. 21Shares Cosmos Staking | 21Shares Uniswap vs. 21Shares Crypto Mid Cap |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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