Correlation Between Uniswap Protocol and Ethereum PoW
Can any of the company-specific risk be diversified away by investing in both Uniswap Protocol and Ethereum PoW 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 Uniswap Protocol and Ethereum PoW into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uniswap Protocol Token and Ethereum PoW, you can compare the effects of market volatilities on Uniswap Protocol and Ethereum PoW 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 Uniswap Protocol with a short position of Ethereum PoW. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniswap Protocol and Ethereum PoW.
Diversification Opportunities for Uniswap Protocol and Ethereum PoW
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Uniswap and Ethereum is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Uniswap Protocol Token and Ethereum PoW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ethereum PoW and Uniswap Protocol 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 Uniswap Protocol Token are associated (or correlated) with Ethereum PoW. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ethereum PoW has no effect on the direction of Uniswap Protocol i.e., Uniswap Protocol and Ethereum PoW go up and down completely randomly.
Pair Corralation between Uniswap Protocol and Ethereum PoW
Assuming the 90 days trading horizon Uniswap Protocol is expected to generate 1.21 times less return on investment than Ethereum PoW. But when comparing it to its historical volatility, Uniswap Protocol Token is 1.18 times less risky than Ethereum PoW. It trades about 0.22 of its potential returns per unit of risk. Ethereum PoW is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 173.00 in Ethereum PoW on August 30, 2024 and sell it today you would earn a total of 246.00 from holding Ethereum PoW or generate 142.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uniswap Protocol Token vs. Ethereum PoW
Performance |
| Timeline |
| Uniswap Protocol Token |
| Ethereum PoW |
Uniswap Protocol and Ethereum PoW Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uniswap Protocol and Ethereum PoW
The main advantage of trading using opposite Uniswap Protocol and Ethereum PoW positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniswap Protocol position performs unexpectedly, Ethereum PoW 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 Ethereum PoW will offset losses from the drop in Ethereum PoW's long position.| Uniswap Protocol vs. Staked Ether | Uniswap Protocol vs. EigenLayer | Uniswap Protocol vs. EOSDAC | Uniswap Protocol vs. BLZ |
| Ethereum PoW vs. Ethereum Classic | Ethereum PoW vs. Ethereum Name Service | Ethereum PoW vs. Staked Ether | Ethereum PoW vs. EigenLayer |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |