Correlation Between SWFTC and EOSDAC

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

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

Diversification Opportunities for SWFTC and EOSDAC

-0.45

Correlation Coefficient

SWFTC  EOSDAC

Very good diversification

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

Pair Corralation between SWFTC and EOSDAC

Assuming the 90 days trading horizon SWFTC is expected to under-perform the EOSDAC. But the crypto coin apears to be less risky and, when comparing its historical volatility, SWFTC is 1.13 times less risky than EOSDAC. The crypto coin trades about -0.05 of its potential returns per unit of risk. The EOSDAC is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  0.05  in EOSDAC on June 14, 2025 and sell it today you would lose  0.00  from holding EOSDAC or give up 1.98% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.65%
Values	Daily Returns

SWFTC  vs.  EOSDAC

SWFTC

Risk-Adjusted Performance

Weakest

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

EOSDAC

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in EOSDAC are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, EOSDAC sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SWFTC and EOSDAC

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

The idea behind SWFTC and EOSDAC 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.