Correlation Between Origin Protocol and HEDG
Can any of the company-specific risk be diversified away by investing in both Origin Protocol and HEDG 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 Origin Protocol and HEDG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Protocol and HEDG, you can compare the effects of market volatilities on Origin Protocol and HEDG 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 Origin Protocol with a short position of HEDG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Protocol and HEDG.
Diversification Opportunities for Origin Protocol and HEDG
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Origin and HEDG is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Origin Protocol and HEDG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEDG and Origin Protocol 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 Origin Protocol are associated (or correlated) with HEDG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEDG has no effect on the direction of Origin Protocol i.e., Origin Protocol and HEDG go up and down completely randomly.
Pair Corralation between Origin Protocol and HEDG
Assuming the 90 days trading horizon Origin Protocol is expected to generate 35.59 times less return on investment than HEDG. But when comparing it to its historical volatility, Origin Protocol is 3.98 times less risky than HEDG. It trades about 0.01 of its potential returns per unit of risk. HEDG is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 36.00 in HEDG on December 29, 2023 and sell it today you would lose (31.96) from holding HEDG or give up 88.78% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Origin Protocol vs. HEDG
Performance |
Timeline |
Origin Protocol |
HEDG |
Origin Protocol and HEDG Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Origin Protocol and HEDG
The main advantage of trading using opposite Origin Protocol and HEDG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Protocol position performs unexpectedly, HEDG 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 HEDG will offset losses from the drop in HEDG's long position.Origin Protocol vs. Staked Ether | Origin Protocol vs. XCAD Network | Origin Protocol vs. Phala Network | Origin Protocol vs. EOSDAC |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |