Correlation Between EigenLayer and COMP

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

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

Diversification Opportunities for EigenLayer and COMP

0.32

Correlation Coefficient

EigenLayer  COMP

Weak diversification

The 3 months correlation between EigenLayer and COMP is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding EigenLayer and COMP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMP and EigenLayer 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 EigenLayer are associated (or correlated) with COMP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMP has no effect on the direction of EigenLayer i.e., EigenLayer and COMP go up and down completely randomly.

Pair Corralation between EigenLayer and COMP

Assuming the 90 days trading horizon EigenLayer is expected to generate 3.05 times less return on investment than COMP. In addition to that, EigenLayer is 1.31 times more volatile than COMP. It trades about 0.0 of its total potential returns per unit of risk. COMP is currently generating about 0.01 per unit of volatility. If you would invest  4,885  in COMP on May 9, 2025 and sell it today you would lose (263.00) from holding COMP or give up 5.38% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.46%
Values	Daily Returns

EigenLayer  vs.  COMP

EigenLayer

Risk-Adjusted Performance

Weakest

Over the last 90 days EigenLayer has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, EigenLayer is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

COMP

Risk-Adjusted Performance

Weakest

Over the last 90 days COMP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, COMP is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with EigenLayer and COMP

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

The idea behind EigenLayer and COMP 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.

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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.