Correlation Between 1inch and CEL

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Can any of the company-specific risk be diversified away by investing in both 1inch and CEL 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 1inch and CEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1inch and CEL, you can compare the effects of market volatilities on 1inch and CEL 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 1inch with a short position of CEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1inch and CEL.

Diversification Opportunities for 1inch and CEL

0.8
  Correlation Coefficient

Very poor diversification

The 3 months correlation between 1inch and CEL is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding 1inch and CEL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEL and 1inch 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 1inch are associated (or correlated) with CEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEL has no effect on the direction of 1inch i.e., 1inch and CEL go up and down completely randomly.

Pair Corralation between 1inch and CEL

Assuming the 90 days trading horizon 1inch is expected to generate 13.92 times less return on investment than CEL. But when comparing it to its historical volatility, 1inch is 2.97 times less risky than CEL. It trades about 0.01 of its potential returns per unit of risk. CEL is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  67.00  in CEL on December 29, 2023 and sell it today you would lose (43.00) from holding CEL or give up 64.18% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

1inch  vs.  CEL

 Performance 
       Timeline  
1inch 

Risk-Adjusted Performance

8 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in 1inch are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical indicators, 1inch exhibited solid returns over the last few months and may actually be approaching a breakup point.
CEL 

Risk-Adjusted Performance

2 of 100

 
Low
 
High
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in CEL are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady essential indicators, CEL may actually be approaching a critical reversion point that can send shares even higher in April 2024.

1inch and CEL Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with 1inch and CEL

The main advantage of trading using opposite 1inch and CEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1inch position performs unexpectedly, CEL 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 CEL will offset losses from the drop in CEL's long position.
The idea behind 1inch and CEL 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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