Correlation Between Sui and DeepBook Protocol

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

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

Diversification Opportunities for Sui and DeepBook Protocol

0.86

Correlation Coefficient

Sui  DeepBook Protocol

Very poor diversification

The 3 months correlation between Sui and DeepBook is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sui and DeepBook Protocol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DeepBook Protocol and Sui 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 Sui are associated (or correlated) with DeepBook Protocol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DeepBook Protocol has no effect on the direction of Sui i.e., Sui and DeepBook Protocol go up and down completely randomly.

Pair Corralation between Sui and DeepBook Protocol

Assuming the 90 days trading horizon Sui is expected to generate 0.79 times more return on investment than DeepBook Protocol. However, Sui is 1.27 times less risky than DeepBook Protocol. It trades about 0.06 of its potential returns per unit of risk. DeepBook Protocol is currently generating about 0.01 per unit of risk. If you would invest  343.00  in Sui on May 1, 2025 and sell it today you would earn a total of  39.00  from holding Sui or generate 11.37% return on investment over 90 days.

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

Sui  vs.  DeepBook Protocol

Sui

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sui are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady forward indicators, Sui exhibited solid returns over the last few months and may actually be approaching a breakup point.

DeepBook Protocol

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in DeepBook Protocol are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, DeepBook Protocol is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Sui and DeepBook Protocol

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

The idea behind Sui and DeepBook Protocol 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.