Correlation Between BRC and Cardano
Can any of the company-specific risk be diversified away by investing in both BRC and Cardano 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 BRC and Cardano into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BRC and Cardano, you can compare the effects of market volatilities on BRC and Cardano 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 BRC with a short position of Cardano. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRC and Cardano.
Diversification Opportunities for BRC and Cardano
Average diversification
The 3 months correlation between BRC and Cardano is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding BRC and Cardano in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardano and BRC 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 BRC are associated (or correlated) with Cardano. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardano has no effect on the direction of BRC i.e., BRC and Cardano go up and down completely randomly.
Pair Corralation between BRC and Cardano
Assuming the 90 days trading horizon BRC is expected to under-perform the Cardano. But the crypto coin apears to be less risky and, when comparing its historical volatility, BRC is 1.14 times less risky than Cardano. The crypto coin trades about -0.01 of its potential returns per unit of risk. The Cardano is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 76.00 in Cardano on January 26, 2024 and sell it today you would lose (26.00) from holding Cardano or give up 34.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 70.76% |
| Values | Daily Returns |
BRC vs. Cardano
Performance |
| Timeline |
| BRC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cardano |
BRC and Cardano Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BRC and Cardano
The main advantage of trading using opposite BRC and Cardano positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRC position performs unexpectedly, Cardano 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 Cardano will offset losses from the drop in Cardano's long position.The idea behind BRC and Cardano 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |