Correlation Between Solana and Hivemapper

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

Diversification Opportunities for Solana and Hivemapper

-0.04
  Correlation Coefficient

Good diversification

The 3 months correlation between Solana and Hivemapper is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Solana and Hivemapper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hivemapper and Solana 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 Solana are associated (or correlated) with Hivemapper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hivemapper has no effect on the direction of Solana i.e., Solana and Hivemapper go up and down completely randomly.

Pair Corralation between Solana and Hivemapper

Assuming the 90 days trading horizon Solana is expected to generate 1.12 times more return on investment than Hivemapper. However, Solana is 1.12 times more volatile than Hivemapper. It trades about 0.01 of its potential returns per unit of risk. Hivemapper is currently generating about -0.36 per unit of risk. If you would invest  19,745  in Solana on November 8, 2024 and sell it today you would lose (626.00) from holding Solana or give up 3.17% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Solana  vs.  Hivemapper

 Performance 
       Timeline  
Solana 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Solana are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound essential indicators, Solana is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.
Hivemapper 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Hivemapper has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for Hivemapper shareholders.

Solana and Hivemapper Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Solana and Hivemapper

The main advantage of trading using opposite Solana and Hivemapper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solana position performs unexpectedly, Hivemapper 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 Hivemapper will offset losses from the drop in Hivemapper's long position.
The idea behind Solana and Hivemapper 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.
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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