Correlation Between Coinbase Global and Guggenheim Municipal
Can any of the company-specific risk be diversified away by investing in both Coinbase Global and Guggenheim Municipal 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 Coinbase Global and Guggenheim Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coinbase Global and Guggenheim Municipal Income, you can compare the effects of market volatilities on Coinbase Global and Guggenheim Municipal 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 Coinbase Global with a short position of Guggenheim Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coinbase Global and Guggenheim Municipal.
Diversification Opportunities for Coinbase Global and Guggenheim Municipal
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Coinbase and Guggenheim is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Coinbase Global and GUGGENHEIM MUNICIPAL INCOME in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Municipal and Coinbase Global 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 Coinbase Global are associated (or correlated) with Guggenheim Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Municipal has no effect on the direction of Coinbase Global i.e., Coinbase Global and Guggenheim Municipal go up and down completely randomly.
Pair Corralation between Coinbase Global and Guggenheim Municipal
Given the investment horizon of 90 days Coinbase Global is expected to generate 36.12 times more return on investment than Guggenheim Municipal. However, Coinbase Global is 36.12 times more volatile than Guggenheim Municipal Income. It trades about 0.24 of its potential returns per unit of risk. Guggenheim Municipal Income is currently generating about 0.0 per unit of risk. If you would invest 19,922 in Coinbase Global on December 29, 2023 and sell it today you would earn a total of 5,748 from holding Coinbase Global or generate 28.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Coinbase Global vs. GUGGENHEIM MUNICIPAL INCOME
Performance |
Timeline |
Coinbase Global |
Guggenheim Municipal |
Coinbase Global and Guggenheim Municipal Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Coinbase Global and Guggenheim Municipal
The main advantage of trading using opposite Coinbase Global and Guggenheim Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coinbase Global position performs unexpectedly, Guggenheim Municipal 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 Guggenheim Municipal will offset losses from the drop in Guggenheim Municipal's long position.Coinbase Global vs. Value Line | Coinbase Global vs. Morningstar | Coinbase Global vs. MSCI Inc | Coinbase Global vs. Nasdaq Inc |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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