Correlation Between ApeCoin and BORA

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

Diversification Opportunities for ApeCoin and BORA

0.79
  Correlation Coefficient

Poor diversification

The 3 months correlation between ApeCoin and BORA is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding ApeCoin and BORA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BORA and ApeCoin 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 ApeCoin are associated (or correlated) with BORA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BORA has no effect on the direction of ApeCoin i.e., ApeCoin and BORA go up and down completely randomly.

Pair Corralation between ApeCoin and BORA

Assuming the 90 days trading horizon ApeCoin is expected to under-perform the BORA. But the crypto coin apears to be less risky and, when comparing its historical volatility, ApeCoin is 1.05 times less risky than BORA. The crypto coin trades about -0.3 of its potential returns per unit of risk. The BORA is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest  21.00  in BORA on January 24, 2024 and sell it today you would lose (5.00) from holding BORA or give up 23.81% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

ApeCoin  vs.  BORA

 Performance 
       Timeline  
ApeCoin 

Risk-Adjusted Performance

2 of 100

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

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in BORA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, BORA exhibited solid returns over the last few months and may actually be approaching a breakup point.

ApeCoin and BORA Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with ApeCoin and BORA

The main advantage of trading using opposite ApeCoin and BORA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ApeCoin position performs unexpectedly, BORA 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 BORA will offset losses from the drop in BORA's long position.
The idea behind ApeCoin and BORA 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 CEOs Directory module to screen CEOs from public companies around the world.

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