Correlation Between Basic Attention and Polygon
Can any of the company-specific risk be diversified away by investing in both Basic Attention and Polygon 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 Basic Attention and Polygon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Basic Attention Token and Polygon, you can compare the effects of market volatilities on Basic Attention and Polygon 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 Basic Attention with a short position of Polygon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Basic Attention and Polygon.
Diversification Opportunities for Basic Attention and Polygon
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Basic and Polygon is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Basic Attention Token and Polygon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polygon and Basic Attention 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 Basic Attention Token are associated (or correlated) with Polygon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polygon has no effect on the direction of Basic Attention i.e., Basic Attention and Polygon go up and down completely randomly.
Pair Corralation between Basic Attention and Polygon
Assuming the 90 days trading horizon Basic Attention is expected to generate 13.9 times less return on investment than Polygon. But when comparing it to its historical volatility, Basic Attention Token is 1.16 times less risky than Polygon. It trades about 0.0 of its potential returns per unit of risk. Polygon is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 51.00 in Polygon on January 25, 2024 and sell it today you would earn a total of 22.00 from holding Polygon or generate 43.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Basic Attention Token vs. Polygon
Performance |
| Timeline |
| Basic Attention Token |
| Polygon |
Basic Attention and Polygon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Basic Attention and Polygon
The main advantage of trading using opposite Basic Attention and Polygon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Basic Attention position performs unexpectedly, Polygon 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 Polygon will offset losses from the drop in Polygon's long position.| Basic Attention vs. Solana | Basic Attention vs. XRP | Basic Attention vs. Staked Ether | Basic Attention vs. The Open Network |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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