Correlation Between USD Coin and EOS
Can any of the company-specific risk be diversified away by investing in both USD Coin and EOS 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 USD Coin and EOS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USD Coin and EOS, you can compare the effects of market volatilities on USD Coin and EOS 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 USD Coin with a short position of EOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of USD Coin and EOS.
Diversification Opportunities for USD Coin and EOS
Pay attention - limited upside
The 3 months correlation between USD and EOS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding USD Coin and EOS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EOS and USD Coin 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 USD Coin are associated (or correlated) with EOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EOS has no effect on the direction of USD Coin i.e., USD Coin and EOS go up and down completely randomly.
Pair Corralation between USD Coin and EOS
Assuming the 90 days trading horizon USD Coin is expected to generate 0.04 times more return on investment than EOS. However, USD Coin is 26.25 times less risky than EOS. It trades about 0.0 of its potential returns per unit of risk. EOS is currently generating about -0.01 per unit of risk. If you would invest 100.00 in USD Coin on January 26, 2024 and sell it today you would earn a total of 0.00 from holding USD Coin or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
USD Coin vs. EOS
Performance |
Timeline |
USD Coin |
EOS |
USD Coin and EOS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with USD Coin and EOS
The main advantage of trading using opposite USD Coin and EOS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USD Coin position performs unexpectedly, EOS 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 EOS will offset losses from the drop in EOS's long position.The idea behind USD Coin and EOS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Equity Valuation Check real value of public entities based on technical and fundamental data | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |