Correlation Between Polygon Ecosystem and KEY
Can any of the company-specific risk be diversified away by investing in both Polygon Ecosystem and KEY 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 Polygon Ecosystem and KEY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polygon Ecosystem Token and KEY, you can compare the effects of market volatilities on Polygon Ecosystem and KEY 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 Polygon Ecosystem with a short position of KEY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polygon Ecosystem and KEY.
Diversification Opportunities for Polygon Ecosystem and KEY
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Polygon and KEY is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Polygon Ecosystem Token and KEY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KEY and Polygon Ecosystem 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 Polygon Ecosystem Token are associated (or correlated) with KEY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KEY has no effect on the direction of Polygon Ecosystem i.e., Polygon Ecosystem and KEY go up and down completely randomly.
Pair Corralation between Polygon Ecosystem and KEY
Assuming the 90 days trading horizon Polygon Ecosystem Token is expected to under-perform the KEY. But the crypto coin apears to be less risky and, when comparing its historical volatility, Polygon Ecosystem Token is 2.55 times less risky than KEY. The crypto coin trades about -0.32 of its potential returns per unit of risk. The KEY is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 0.11 in KEY on November 10, 2024 and sell it today you would lose (0.04) from holding KEY or give up 33.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polygon Ecosystem Token vs. KEY
Performance |
| Timeline |
| Polygon Ecosystem Token |
| KEY |
Polygon Ecosystem and KEY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polygon Ecosystem and KEY
The main advantage of trading using opposite Polygon Ecosystem and KEY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polygon Ecosystem position performs unexpectedly, KEY 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 KEY will offset losses from the drop in KEY's long position.| Polygon Ecosystem vs. Staked Ether | Polygon Ecosystem vs. Phala Network | Polygon Ecosystem vs. EigenLayer | Polygon Ecosystem vs. EOSDAC |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |