Correlation Between Polygon Ecosystem and NEO
Can any of the company-specific risk be diversified away by investing in both Polygon Ecosystem and NEO 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 NEO 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 NEO, you can compare the effects of market volatilities on Polygon Ecosystem and NEO 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 NEO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polygon Ecosystem and NEO.
Diversification Opportunities for Polygon Ecosystem and NEO
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Polygon and NEO is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Polygon Ecosystem Token and NEO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEO 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 NEO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEO has no effect on the direction of Polygon Ecosystem i.e., Polygon Ecosystem and NEO go up and down completely randomly.
Pair Corralation between Polygon Ecosystem and NEO
Assuming the 90 days trading horizon Polygon Ecosystem Token is expected to generate 1.59 times more return on investment than NEO. However, Polygon Ecosystem is 1.59 times more volatile than NEO. It trades about 0.5 of its potential returns per unit of risk. NEO is currently generating about 0.63 per unit of risk. If you would invest 31.00 in Polygon Ecosystem Token on September 2, 2024 and sell it today you would earn a total of 29.00 from holding Polygon Ecosystem Token or generate 93.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polygon Ecosystem Token vs. NEO
Performance |
| Timeline |
| Polygon Ecosystem Token |
| NEO |
Polygon Ecosystem and NEO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polygon Ecosystem and NEO
The main advantage of trading using opposite Polygon Ecosystem and NEO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polygon Ecosystem position performs unexpectedly, NEO 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 NEO will offset losses from the drop in NEO's long position.| Polygon Ecosystem vs. Staked Ether | Polygon Ecosystem vs. EigenLayer | Polygon Ecosystem vs. EOSDAC | Polygon Ecosystem 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |