Correlation Between KuCoin Token and BTM
Can any of the company-specific risk be diversified away by investing in both KuCoin Token and BTM 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 KuCoin Token and BTM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KuCoin Token and BTM, you can compare the effects of market volatilities on KuCoin Token and BTM 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 KuCoin Token with a short position of BTM. Check out your portfolio center. Please also check ongoing floating volatility patterns of KuCoin Token and BTM.
Diversification Opportunities for KuCoin Token and BTM
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KuCoin and BTM is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding KuCoin Token and BTM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTM and KuCoin Token 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 KuCoin Token are associated (or correlated) with BTM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTM has no effect on the direction of KuCoin Token i.e., KuCoin Token and BTM go up and down completely randomly.
Pair Corralation between KuCoin Token and BTM
Assuming the 90 days trading horizon KuCoin Token is expected to generate 9.57 times more return on investment than BTM. However, KuCoin Token is 9.57 times more volatile than BTM. It trades about 0.06 of its potential returns per unit of risk. BTM is currently generating about 0.03 per unit of risk. If you would invest 997.00 in KuCoin Token on January 19, 2024 and sell it today you would lose (180.00) from holding KuCoin Token or give up 18.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KuCoin Token vs. BTM
Performance |
| Timeline |
| KuCoin Token |
| BTM |
KuCoin Token and BTM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KuCoin Token and BTM
The main advantage of trading using opposite KuCoin Token and BTM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KuCoin Token position performs unexpectedly, BTM 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 BTM will offset losses from the drop in BTM's long position.| KuCoin Token vs. Solana | KuCoin Token vs. XRP | KuCoin Token vs. The Open Network | KuCoin Token vs. Staked Ether |
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.
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