Correlation Between Audius and Klaytn

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

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

Diversification Opportunities for Audius and Klaytn

0.95

Correlation Coefficient

Audius  Klaytn

Almost no diversification

The 3 months correlation between Audius and Klaytn is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Audius and Klaytn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klaytn and Audius 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 Audius are associated (or correlated) with Klaytn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klaytn has no effect on the direction of Audius i.e., Audius and Klaytn go up and down completely randomly.

Pair Corralation between Audius and Klaytn

Assuming the 90 days trading horizon Audius is expected to under-perform the Klaytn. In addition to that, Audius is 1.14 times more volatile than Klaytn. It trades about -0.23 of its total potential returns per unit of risk. Klaytn is currently generating about -0.18 per unit of volatility. If you would invest  28.00  in Klaytn on January 25, 2024 and sell it today you would lose (7.00) from holding Klaytn or give up 25.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	95.65%
Values	Daily Returns

Audius  vs.  Klaytn

Audius

Risk-Adjusted Performance

2 of 100

Insignificant

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

Klaytn

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Klaytn are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Klaytn exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Audius and Klaytn

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

The idea behind Audius and Klaytn 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.