Correlation Between Axie Infinity and ADX
Can any of the company-specific risk be diversified away by investing in both Axie Infinity and ADX 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 Axie Infinity and ADX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axie Infinity Shards and ADX, you can compare the effects of market volatilities on Axie Infinity and ADX 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 Axie Infinity with a short position of ADX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axie Infinity and ADX.
Diversification Opportunities for Axie Infinity and ADX
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Axie and ADX is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Axie Infinity Shards and ADX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADX and Axie Infinity 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 Axie Infinity Shards are associated (or correlated) with ADX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADX has no effect on the direction of Axie Infinity i.e., Axie Infinity and ADX go up and down completely randomly.
Pair Corralation between Axie Infinity and ADX
Assuming the 90 days trading horizon Axie Infinity Shards is expected to under-perform the ADX. But the crypto coin apears to be less risky and, when comparing its historical volatility, Axie Infinity Shards is 1.39 times less risky than ADX. The crypto coin trades about -0.25 of its potential returns per unit of risk. The ADX is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 25.00 in ADX on January 20, 2024 and sell it today you would lose (4.00) from holding ADX or give up 16.0% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Axie Infinity Shards vs. ADX
Performance |
Timeline |
Axie Infinity Shards |
ADX |
Axie Infinity and ADX Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Axie Infinity and ADX
The main advantage of trading using opposite Axie Infinity and ADX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axie Infinity position performs unexpectedly, ADX 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 ADX will offset losses from the drop in ADX's long position.Axie Infinity vs. Solana | Axie Infinity vs. XRP | Axie Infinity vs. The Open Network | Axie Infinity vs. Staked Ether |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Equity Valuation Check real value of public entities based on technical and fundamental data | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |