Correlation Between Uniswap Protocol and Illuvium
Can any of the company-specific risk be diversified away by investing in both Uniswap Protocol and Illuvium 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 Illuvium 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 Illuvium, you can compare the effects of market volatilities on Uniswap Protocol and Illuvium 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 Illuvium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniswap Protocol and Illuvium.
Diversification Opportunities for Uniswap Protocol and Illuvium
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Uniswap and Illuvium is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Uniswap Protocol Token and Illuvium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Illuvium 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 Illuvium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Illuvium has no effect on the direction of Uniswap Protocol i.e., Uniswap Protocol and Illuvium go up and down completely randomly.
Pair Corralation between Uniswap Protocol and Illuvium
Assuming the 90 days trading horizon Uniswap Protocol Token is expected to generate 0.95 times more return on investment than Illuvium. However, Uniswap Protocol Token is 1.05 times less risky than Illuvium. It trades about -0.09 of its potential returns per unit of risk. Illuvium is currently generating about -0.18 per unit of risk. If you would invest 1,360 in Uniswap Protocol Token on November 1, 2024 and sell it today you would lose (188.00) from holding Uniswap Protocol Token or give up 13.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uniswap Protocol Token vs. Illuvium
Performance |
| Timeline |
| Uniswap Protocol Token |
| Illuvium |
Uniswap Protocol and Illuvium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uniswap Protocol and Illuvium
The main advantage of trading using opposite Uniswap Protocol and Illuvium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniswap Protocol position performs unexpectedly, Illuvium 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 Illuvium will offset losses from the drop in Illuvium's long position.| Uniswap Protocol vs. Staked Ether | Uniswap Protocol vs. Phala Network | Uniswap Protocol vs. EigenLayer | Uniswap Protocol 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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