Correlation Between Power Ledger and Cronos
Can any of the company-specific risk be diversified away by investing in both Power Ledger and Cronos 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 Power Ledger and Cronos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Power Ledger and Cronos, you can compare the effects of market volatilities on Power Ledger and Cronos 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 Power Ledger with a short position of Cronos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Power Ledger and Cronos.
Diversification Opportunities for Power Ledger and Cronos
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Power and Cronos is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Power Ledger and Cronos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cronos and Power Ledger 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 Power Ledger are associated (or correlated) with Cronos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cronos has no effect on the direction of Power Ledger i.e., Power Ledger and Cronos go up and down completely randomly.
Pair Corralation between Power Ledger and Cronos
Assuming the 90 days trading horizon Power Ledger is expected to generate 1.49 times more return on investment than Cronos. However, Power Ledger is 1.49 times more volatile than Cronos. It trades about 0.03 of its potential returns per unit of risk. Cronos is currently generating about -0.01 per unit of risk. If you would invest 42.00 in Power Ledger on January 20, 2024 and sell it today you would lose (13.00) from holding Power Ledger or give up 30.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Power Ledger vs. Cronos
Performance |
| Timeline |
| Power Ledger |
| Cronos |
Power Ledger and Cronos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Power Ledger and Cronos
The main advantage of trading using opposite Power Ledger and Cronos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Power Ledger position performs unexpectedly, Cronos 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 Cronos will offset losses from the drop in Cronos' long position.| Power Ledger vs. Solana | Power Ledger vs. XRP | Power Ledger vs. The Open Network | Power Ledger 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |