Correlation Between Origin Protocol and Quant
Can any of the company-specific risk be diversified away by investing in both Origin Protocol and Quant 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 Quant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Protocol and Quant, you can compare the effects of market volatilities on Origin Protocol and Quant 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 Quant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Protocol and Quant.
Diversification Opportunities for Origin Protocol and Quant
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Origin and Quant is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Origin Protocol and Quant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quant 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 Quant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quant has no effect on the direction of Origin Protocol i.e., Origin Protocol and Quant go up and down completely randomly.
Pair Corralation between Origin Protocol and Quant
Assuming the 90 days trading horizon Origin Protocol is expected to generate 2.84 times less return on investment than Quant. In addition to that, Origin Protocol is 1.49 times more volatile than Quant. It trades about 0.01 of its total potential returns per unit of risk. Quant is currently generating about 0.03 per unit of volatility. If you would invest 9,303 in Quant on January 20, 2024 and sell it today you would earn a total of 1,544 from holding Quant or generate 16.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Origin Protocol vs. Quant
Performance |
| Timeline |
| Origin Protocol |
| Quant |
Origin Protocol and Quant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Protocol and Quant
The main advantage of trading using opposite Origin Protocol and Quant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Protocol position performs unexpectedly, Quant 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 Quant will offset losses from the drop in Quant's long position.| Origin Protocol vs. Solana | Origin Protocol vs. XRP | Origin Protocol vs. The Open Network | Origin Protocol 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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