Correlation Between Power Ledger and Origin Protocol
Can any of the company-specific risk be diversified away by investing in both Power Ledger and Origin Protocol 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 Origin Protocol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Power Ledger and Origin Protocol, you can compare the effects of market volatilities on Power Ledger and Origin Protocol 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 Origin Protocol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Power Ledger and Origin Protocol.
Diversification Opportunities for Power Ledger and Origin Protocol
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Power and Origin is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Power Ledger and Origin Protocol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Protocol 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 Origin Protocol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Protocol has no effect on the direction of Power Ledger i.e., Power Ledger and Origin Protocol go up and down completely randomly.
Pair Corralation between Power Ledger and Origin Protocol
Assuming the 90 days trading horizon Power Ledger is expected to generate 0.94 times more return on investment than Origin Protocol. However, Power Ledger is 1.06 times less risky than Origin Protocol. It trades about -0.1 of its potential returns per unit of risk. Origin Protocol is currently generating about -0.13 per unit of risk. If you would invest 37.00 in Power Ledger on January 21, 2024 and sell it today you would lose (7.00) from holding Power Ledger or give up 18.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Power Ledger vs. Origin Protocol
Performance |
| Timeline |
| Power Ledger |
| Origin Protocol |
Power Ledger and Origin Protocol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Power Ledger and Origin Protocol
The main advantage of trading using opposite Power Ledger and Origin Protocol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Power Ledger position performs unexpectedly, Origin Protocol 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 Origin Protocol will offset losses from the drop in Origin Protocol's long position.| Power Ledger vs. Solana | Power Ledger vs. XRP | Power Ledger vs. The Open Network | Power Ledger vs. Staked Ether |
| 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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