Correlation Between KuCoin Token and MONA

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

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

Diversification Opportunities for KuCoin Token and MONA

0.81

Correlation Coefficient

KuCoin Token  MONA

Very poor diversification

The 3 months correlation between KuCoin and MONA is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding KuCoin Token and MONA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MONA and KuCoin Token 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 KuCoin Token are associated (or correlated) with MONA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MONA has no effect on the direction of KuCoin Token i.e., KuCoin Token and MONA go up and down completely randomly.

Pair Corralation between KuCoin Token and MONA

Assuming the 90 days trading horizon KuCoin Token is expected to generate 1.12 times more return on investment than MONA. However, KuCoin Token is 1.12 times more volatile than MONA. It trades about -0.07 of its potential returns per unit of risk. MONA is currently generating about -0.16 per unit of risk. If you would invest  1,094  in KuCoin Token on January 29, 2024 and sell it today you would lose (91.00) from holding KuCoin Token or give up 8.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

KuCoin Token  vs.  MONA

KuCoin Token

Risk-Adjusted Performance

2 of 100

Weak

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

MONA

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in MONA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, MONA is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with KuCoin Token and MONA

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

The idea behind KuCoin Token and MONA 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 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.