Correlation Between Xp and Hut 8
Can any of the company-specific risk be diversified away by investing in both Xp and Hut 8 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 Xp and Hut 8 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xp Inc and Hut 8 Corp, you can compare the effects of market volatilities on Xp and Hut 8 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 Xp with a short position of Hut 8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xp and Hut 8.
Diversification Opportunities for Xp and Hut 8
Pay attention - limited upside
The 3 months correlation between Xp and Hut is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Xp Inc and Hut 8 Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hut 8 Corp and Xp 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 Xp Inc are associated (or correlated) with Hut 8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hut 8 Corp has no effect on the direction of Xp i.e., Xp and Hut 8 go up and down completely randomly.
Pair Corralation between Xp and Hut 8
Allowing for the 90-day total investment horizon Xp Inc is expected to under-perform the Hut 8. But the stock apears to be less risky and, when comparing its historical volatility, Xp Inc is 3.23 times less risky than Hut 8. The stock trades about -0.23 of its potential returns per unit of risk. The Hut 8 Corp is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,721 in Hut 8 Corp on August 28, 2024 and sell it today you would earn a total of 803.00 from holding Hut 8 Corp or generate 46.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xp Inc vs. Hut 8 Corp
Performance |
| Timeline |
| Xp Inc |
| Hut 8 Corp |
Xp and Hut 8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xp and Hut 8
The main advantage of trading using opposite Xp and Hut 8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xp position performs unexpectedly, Hut 8 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 Hut 8 will offset losses from the drop in Hut 8's long position.| Xp vs. Up Fintech Holding | Xp vs. Bit Digital | Xp vs. Marathon Digital Holdings | Xp vs. MarketAxess Holdings |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |