Correlation Between XRP and Korea New
Can any of the company-specific risk be diversified away by investing in both XRP and Korea New 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 XRP and Korea New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XRP and Korea New Network, you can compare the effects of market volatilities on XRP and Korea New 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 XRP with a short position of Korea New. Check out your portfolio center. Please also check ongoing floating volatility patterns of XRP and Korea New.
Diversification Opportunities for XRP and Korea New
Modest diversification
The 3 months correlation between XRP and Korea is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding XRP and Korea New Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea New Network and XRP 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 XRP are associated (or correlated) with Korea New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea New Network has no effect on the direction of XRP i.e., XRP and Korea New go up and down completely randomly.
Pair Corralation between XRP and Korea New
Assuming the 90 days trading horizon XRP is expected to generate 3.14 times more return on investment than Korea New. However, XRP is 3.14 times more volatile than Korea New Network. It trades about 0.13 of its potential returns per unit of risk. Korea New Network is currently generating about 0.0 per unit of risk. If you would invest 38.00 in XRP on November 2, 2024 and sell it today you would earn a total of 275.00 from holding XRP or generate 723.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 62.21% |
| Values | Daily Returns |
XRP vs. Korea New Network
Performance |
| Timeline |
| XRP |
| Korea New Network |
XRP and Korea New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XRP and Korea New
The main advantage of trading using opposite XRP and Korea New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XRP position performs unexpectedly, Korea New 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 Korea New will offset losses from the drop in Korea New's long position.The idea behind XRP and Korea New Network 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.| Korea New vs. KakaoBank Corp | Korea New vs. CG Hi Tech | Korea New vs. V One Tech Co | Korea New vs. Yura Tech Co |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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