Correlation Between Uniswap Protocol and HSC

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Can any of the company-specific risk be diversified away by investing in both Uniswap Protocol and HSC 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 HSC 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 HSC, you can compare the effects of market volatilities on Uniswap Protocol and HSC 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 HSC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniswap Protocol and HSC.

Diversification Opportunities for Uniswap Protocol and HSC

-0.21
  Correlation Coefficient

Very good diversification

The 3 months correlation between Uniswap and HSC is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Uniswap Protocol Token and HSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HSC 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 HSC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HSC has no effect on the direction of Uniswap Protocol i.e., Uniswap Protocol and HSC go up and down completely randomly.

Pair Corralation between Uniswap Protocol and HSC

Assuming the 90 days trading horizon Uniswap Protocol is expected to generate 1.41 times less return on investment than HSC. But when comparing it to its historical volatility, Uniswap Protocol Token is 3.3 times less risky than HSC. It trades about 0.24 of its potential returns per unit of risk. HSC is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  0.00  in HSC on August 30, 2024 and sell it today you would lose  0.00  from holding HSC or give up 20.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Uniswap Protocol Token  vs.  HSC

 Performance 
       Timeline  
Uniswap Protocol Token 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Uniswap Protocol Token are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady forward indicators, Uniswap Protocol exhibited solid returns over the last few months and may actually be approaching a breakup point.
HSC 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in HSC are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, HSC exhibited solid returns over the last few months and may actually be approaching a breakup point.

Uniswap Protocol and HSC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Uniswap Protocol and HSC

The main advantage of trading using opposite Uniswap Protocol and HSC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniswap Protocol position performs unexpectedly, HSC 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 HSC will offset losses from the drop in HSC's long position.
The idea behind Uniswap Protocol Token and HSC 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.
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

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