Correlation Between WhiteBIT Token and LUN
Can any of the company-specific risk be diversified away by investing in both WhiteBIT Token and LUN 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 WhiteBIT Token and LUN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WhiteBIT Token and LUN, you can compare the effects of market volatilities on WhiteBIT Token and LUN 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 WhiteBIT Token with a short position of LUN. Check out your portfolio center. Please also check ongoing floating volatility patterns of WhiteBIT Token and LUN.
Diversification Opportunities for WhiteBIT Token and LUN
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between WhiteBIT and LUN is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding WhiteBIT Token and LUN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LUN and WhiteBIT Token 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 WhiteBIT Token are associated (or correlated) with LUN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LUN has no effect on the direction of WhiteBIT Token i.e., WhiteBIT Token and LUN go up and down completely randomly.
Pair Corralation between WhiteBIT Token and LUN
Assuming the 90 days trading horizon WhiteBIT Token is expected to generate 2.11 times less return on investment than LUN. But when comparing it to its historical volatility, WhiteBIT Token is 6.28 times less risky than LUN. It trades about 0.23 of its potential returns per unit of risk. LUN is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1.03 in LUN on August 27, 2024 and sell it today you would earn a total of 1.02 from holding LUN or generate 99.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 45.15% |
| Values | Daily Returns |
WhiteBIT Token vs. LUN
Performance |
| Timeline |
| WhiteBIT Token |
| LUN |
WhiteBIT Token and LUN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WhiteBIT Token and LUN
The main advantage of trading using opposite WhiteBIT Token and LUN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WhiteBIT Token position performs unexpectedly, LUN 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 LUN will offset losses from the drop in LUN's long position.| WhiteBIT Token vs. Staked Ether | WhiteBIT Token vs. EigenLayer | WhiteBIT Token vs. EOSDAC | WhiteBIT Token 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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