Correlation Between XDC Network and FileCoin
Can any of the company-specific risk be diversified away by investing in both XDC Network and FileCoin 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 XDC Network and FileCoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XDC Network and FileCoin, you can compare the effects of market volatilities on XDC Network and FileCoin 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 XDC Network with a short position of FileCoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of XDC Network and FileCoin.
Diversification Opportunities for XDC Network and FileCoin
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between XDC and FileCoin is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding XDC Network and FileCoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FileCoin and XDC Network 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 XDC Network are associated (or correlated) with FileCoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FileCoin has no effect on the direction of XDC Network i.e., XDC Network and FileCoin go up and down completely randomly.
Pair Corralation between XDC Network and FileCoin
Assuming the 90 days trading horizon XDC Network is expected to generate 1.91 times more return on investment than FileCoin. However, XDC Network is 1.91 times more volatile than FileCoin. It trades about 0.24 of its potential returns per unit of risk. FileCoin is currently generating about -0.06 per unit of risk. If you would invest 8.31 in XDC Network on October 23, 2024 and sell it today you would earn a total of 3.69 from holding XDC Network or generate 44.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
XDC Network vs. FileCoin
Performance |
| Timeline |
| XDC Network |
| FileCoin |
XDC Network and FileCoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XDC Network and FileCoin
The main advantage of trading using opposite XDC Network and FileCoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XDC Network position performs unexpectedly, FileCoin 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 FileCoin will offset losses from the drop in FileCoin's long position.| XDC Network vs. Staked Ether | XDC Network vs. Phala Network | XDC Network vs. EigenLayer | XDC Network 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |