Correlation Between Maverick Protocol and CEL

Can any of the company-specific risk be diversified away by investing in both Maverick Protocol and CEL 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 Maverick Protocol and CEL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Maverick Protocol and CEL, you can compare the effects of market volatilities on Maverick Protocol and CEL 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 Maverick Protocol with a short position of CEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maverick Protocol and CEL.

Diversification Opportunities for Maverick Protocol and CEL

0.58

Correlation Coefficient

Maverick Protocol  CEL

Very weak diversification

The 3 months correlation between Maverick and CEL is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Maverick Protocol and CEL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEL and Maverick 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 Maverick Protocol are associated (or correlated) with CEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEL has no effect on the direction of Maverick Protocol i.e., Maverick Protocol and CEL go up and down completely randomly.

Pair Corralation between Maverick Protocol and CEL

Assuming the 90 days trading horizon Maverick Protocol is expected to generate 0.9 times more return on investment than CEL. However, Maverick Protocol is 1.11 times less risky than CEL. It trades about -0.26 of its potential returns per unit of risk. CEL is currently generating about -0.4 per unit of risk. If you would invest  67.00  in Maverick Protocol on January 29, 2024 and sell it today you would lose (28.00) from holding Maverick Protocol or give up 41.79% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Maverick Protocol  vs.  CEL

Maverick Protocol

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maverick Protocol has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's basic indicators remain rather sound which may send shares a bit higher in May 2024. The latest tumult may also be a sign of longer-term up-swing for Maverick Protocol shareholders.

CEL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CEL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather unsteady essential indicators, CEL may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with Maverick Protocol and CEL

The main advantage of trading using opposite Maverick Protocol and CEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maverick Protocol position performs unexpectedly, CEL 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 CEL will offset losses from the drop in CEL's long position.

The idea behind Maverick Protocol and CEL 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.