Correlation Between Polygon Ecosystem and DGB

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

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

Diversification Opportunities for Polygon Ecosystem and DGB

-0.45

Correlation Coefficient

Polygon Ecosystem  DGB

Very good diversification

The 3 months correlation between Polygon and DGB is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Polygon Ecosystem Token and DGB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DGB and Polygon Ecosystem 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 Polygon Ecosystem Token are associated (or correlated) with DGB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DGB has no effect on the direction of Polygon Ecosystem i.e., Polygon Ecosystem and DGB go up and down completely randomly.

Pair Corralation between Polygon Ecosystem and DGB

Assuming the 90 days trading horizon Polygon Ecosystem Token is expected to generate 1.63 times more return on investment than DGB. However, Polygon Ecosystem is 1.63 times more volatile than DGB. It trades about 0.29 of its potential returns per unit of risk. DGB is currently generating about 0.04 per unit of risk. If you would invest  18.00  in Polygon Ecosystem Token on February 8, 2025 and sell it today you would earn a total of  7.00  from holding Polygon Ecosystem Token or generate 38.89% return on investment over 90 days.

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

Polygon Ecosystem Token  vs.  DGB

Polygon Ecosystem Token

Risk-Adjusted Performance

Very Weak

Over the last 90 days Polygon Ecosystem Token has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Crypto's essential indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for Polygon Ecosystem Token shareholders.

DGB

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in DGB are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental drivers, DGB exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Polygon Ecosystem and DGB

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

The idea behind Polygon Ecosystem Token and DGB 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.