Correlation Between Monero and Cronos
Can any of the company-specific risk be diversified away by investing in both Monero and Cronos 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 Monero and Cronos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monero and Cronos, you can compare the effects of market volatilities on Monero and Cronos 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 Monero with a short position of Cronos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monero and Cronos.
Diversification Opportunities for Monero and Cronos
Excellent diversification
The 3 months correlation between Monero and Cronos is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Monero and Cronos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cronos and Monero 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 Monero are associated (or correlated) with Cronos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cronos has no effect on the direction of Monero i.e., Monero and Cronos go up and down completely randomly.
Pair Corralation between Monero and Cronos
Assuming the 90 days trading horizon Monero is expected to generate 0.8 times more return on investment than Cronos. However, Monero is 1.24 times less risky than Cronos. It trades about 0.1 of its potential returns per unit of risk. Cronos is currently generating about -0.42 per unit of risk. If you would invest 21,776 in Monero on November 18, 2024 and sell it today you would earn a total of 1,233 from holding Monero or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monero vs. Cronos
Performance |
| Timeline |
| Monero |
| Cronos |
Monero and Cronos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monero and Cronos
The main advantage of trading using opposite Monero and Cronos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monero position performs unexpectedly, Cronos 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 Cronos will offset losses from the drop in Cronos' long position.The idea behind Monero and Cronos 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |