Correlation Between OFFICIAL TRUMP and LEO Token

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

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

Diversification Opportunities for OFFICIAL TRUMP and LEO Token

-0.47

Correlation Coefficient

OFFICIAL TRUMP  LEO Token

Very good diversification

The 3 months correlation between OFFICIAL and LEO is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding OFFICIAL TRUMP and LEO Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LEO Token and OFFICIAL TRUMP 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 OFFICIAL TRUMP are associated (or correlated) with LEO Token. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LEO Token has no effect on the direction of OFFICIAL TRUMP i.e., OFFICIAL TRUMP and LEO Token go up and down completely randomly.

Pair Corralation between OFFICIAL TRUMP and LEO Token

Assuming the 90 days trading horizon OFFICIAL TRUMP is expected to under-perform the LEO Token. In addition to that, OFFICIAL TRUMP is 2.87 times more volatile than LEO Token. It trades about -0.03 of its total potential returns per unit of risk. LEO Token is currently generating about 0.01 per unit of volatility. If you would invest  900.00  in LEO Token on May 2, 2025 and sell it today you would earn a total of  1.00  from holding LEO Token or generate 0.11% return on investment over 90 days.

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

OFFICIAL TRUMP  vs.  LEO Token

OFFICIAL TRUMP

Risk-Adjusted Performance

Very Weak

Over the last 90 days OFFICIAL TRUMP 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 OFFICIAL TRUMP shareholders.

LEO Token

Risk-Adjusted Performance

Very Weak

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

Pair Trading with OFFICIAL TRUMP and LEO Token

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

The idea behind OFFICIAL TRUMP and LEO Token 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.