Correlation Between Uniswap Protocol and Jupiter
Can any of the company-specific risk be diversified away by investing in both Uniswap Protocol and Jupiter 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 Jupiter 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 Jupiter, you can compare the effects of market volatilities on Uniswap Protocol and Jupiter 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 Jupiter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniswap Protocol and Jupiter.
Diversification Opportunities for Uniswap Protocol and Jupiter
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Uniswap and Jupiter is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Uniswap Protocol Token and Jupiter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupiter 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 Jupiter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupiter has no effect on the direction of Uniswap Protocol i.e., Uniswap Protocol and Jupiter go up and down completely randomly.
Pair Corralation between Uniswap Protocol and Jupiter
Assuming the 90 days trading horizon Uniswap Protocol Token is expected to generate 1.45 times more return on investment than Jupiter. However, Uniswap Protocol is 1.45 times more volatile than Jupiter. It trades about 0.25 of its potential returns per unit of risk. Jupiter is currently generating about 0.05 per unit of risk. If you would invest 793.00 in Uniswap Protocol Token on August 27, 2024 and sell it today you would earn a total of 336.00 from holding Uniswap Protocol Token or generate 42.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uniswap Protocol Token vs. Jupiter
Performance |
| Timeline |
| Uniswap Protocol Token |
| Jupiter |
Uniswap Protocol and Jupiter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uniswap Protocol and Jupiter
The main advantage of trading using opposite Uniswap Protocol and Jupiter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniswap Protocol position performs unexpectedly, Jupiter 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 Jupiter will offset losses from the drop in Jupiter's long position.| Uniswap Protocol vs. Staked Ether | Uniswap Protocol vs. EigenLayer | Uniswap Protocol vs. EOSDAC | Uniswap Protocol 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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