Correlation Between Staked Ether and Illuvium
Can any of the company-specific risk be diversified away by investing in both Staked Ether and Illuvium 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 Staked Ether and Illuvium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Staked Ether and Illuvium, you can compare the effects of market volatilities on Staked Ether and Illuvium 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 Staked Ether with a short position of Illuvium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Staked Ether and Illuvium.
Diversification Opportunities for Staked Ether and Illuvium
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Staked and Illuvium is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Staked Ether and Illuvium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Illuvium and Staked Ether 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 Staked Ether are associated (or correlated) with Illuvium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Illuvium has no effect on the direction of Staked Ether i.e., Staked Ether and Illuvium go up and down completely randomly.
Pair Corralation between Staked Ether and Illuvium
Assuming the 90 days trading horizon Staked Ether is expected to generate 0.53 times more return on investment than Illuvium. However, Staked Ether is 1.88 times less risky than Illuvium. It trades about -0.14 of its potential returns per unit of risk. Illuvium is currently generating about -0.18 per unit of risk. If you would invest 348,754 in Staked Ether on January 20, 2024 and sell it today you would lose (41,871) from holding Staked Ether or give up 12.01% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 95.65% |
Values | Daily Returns |
Staked Ether vs. Illuvium
Performance |
Timeline |
Staked Ether |
Illuvium |
Staked Ether and Illuvium Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Staked Ether and Illuvium
The main advantage of trading using opposite Staked Ether and Illuvium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Staked Ether position performs unexpectedly, Illuvium 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 Illuvium will offset losses from the drop in Illuvium's long position.Staked Ether vs. Solana | Staked Ether vs. XRP | Staked Ether vs. The Open Network | Staked Ether vs. Avalanche |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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