This module allows you to analyze existing cross correlation between Poloniex Bitcoin USD and Quoine Bitcoin USD. You can compare the effects of market volatilities on Poloniex Bitcoin and Quoine Bitcoin 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 Poloniex Bitcoin with a short position of Quoine Bitcoin. See also your portfolio center. Please also check ongoing floating volatility patterns of Poloniex Bitcoin and Quoine Bitcoin.
Assuming 30 trading days horizon, Poloniex Bitcoin USD is expected to generate 1.05 times more return on investment than Quoine Bitcoin. However, Poloniex Bitcoin is 1.05 times more volatile than Quoine Bitcoin USD. It trades about -0.09 of its potential returns per unit of risk. Quoine Bitcoin USD is currently generating about -0.1 per unit of risk. If you would invest 1,169,900 in Poloniex Bitcoin USD on March 21, 2018 and sell it today you would lose (335,920) from holding Poloniex Bitcoin USD or give up 28.71% of portfolio value over 30 days.
Pair Corralation between Poloniex Bitcoin and Quoine Bitcoin
Overlapping area represents the amount of risk that can be diversified away by holding Poloniex Bitcoin USD and Quoine Bitcoin USD in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Quoine Bitcoin USD and Poloniex Bitcoin 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 Poloniex Bitcoin USD are associated (or correlated) with Quoine Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quoine Bitcoin USD has no effect on the direction of Poloniex Bitcoin i.e. Poloniex Bitcoin and Quoine Bitcoin go up and down completely randomly.
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