Cardano Volatility

ADA -  USA Crypto  

USD 1.31  0.02  1.55%

Cardano appears to be unreasonably risky, given 3 months investment horizon. Cardano secures Sharpe Ratio (or Efficiency) of 0.0397, which signifies that digital coin had 0.0397% of return per unit of risk over the last 3 months. Our standpoint towards foreseeing the volatility of a crypto is to use all available market data together with crypto-specific technical indicators that cannot be diversified away. We have found twenty-one technical indicators for Cardano, which you can use to evaluate the future volatility of coin. Please makes use of Cardano's Downside Deviation of 7.75, risk adjusted performance of 0.0326, and Mean Deviation of 5.52 to double-check if our risk estimates are consistent with your expectations.

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Cardano Crypto Coin volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Cardano daily returns, and it is calculated using variance and standard deviation. We also use Cardano's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Cardano volatility.

660 Days Market Risk

Unreasonably risky

Chance of Distress

Above Average

660 Days Economic Sensitivity

Moves totally opposite to the market

Cardano Market Sensitivity And Downside Risk

Cardano's beta coefficient measures the volatility of Cardano crypto coin compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Cardano crypto coin's returns against your selected market. In other words, Cardano's beta of -0.99 provides an investor with an approximation of how much risk Cardano crypto coin can potentially add to one of your existing portfolios.
Let's try to break down what Cardano's beta means in this case. As the market becomes more bullish, returns on owning Cardano are expected to decrease slowly. On the other hand, during market turmoil, Cardano is expected to outperform it slightly.
3 Months Beta |Analyze Cardano Demand Trend
Check current 90 days Cardano correlation with market (DOW)

Cardano Beta

    
  -0.99  
Cardano standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  7.75  
It is essential to understand the difference between upside risk (as represented by Cardano's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Cardano stock's daily returns or price. Since the actual investment returns on holding a position in Cardano stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Cardano.

Cardano Crypto Coin Volatility Analysis

Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Cardano Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input. View also all equity analysis or get more info about average price price transform indicator.

Cardano Projected Return Density Against Market

Assuming the 90 days trading horizon Cardano has a beta of -0.9928 . This suggests
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Cardano or Blockchain sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Cardano stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Cardano stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has an alpha of 0.2786, implying that it can generate a 0.28 percent excess return over DOW after adjusting for the inherited market risk (beta).
 Predicted Return Density 
      Returns 

Cardano Crypto Coin Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Cardano or Blockchain sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Cardano stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Cardano stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Assuming the 90 days trading horizon the coefficient of variation of Cardano is 2518.31. The daily returns are distributed with a variance of 60.11 and standard deviation of 7.75. The mean deviation of Cardano is currently at 5.54. For similar time horizon, the selected benchmark (DOW) has volatility of 0.74
α
Alpha over DOW
0.28
β
Beta against DOW-0.99
σ
Overall volatility
7.75
Ir
Information ratio 0.0253

Cardano Crypto Coin Return Volatility

Cardano historical daily return volatility represents how much Cardano stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. Cardano assumes 7.7532% volatility of returns over the 90 days investment horizon. By contrast, DOW inherits 0.7403% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
      Timeline 

About Cardano Volatility

Volatility is a rate at which the price of Cardano or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Cardano may increase or decrease. In other words, similar to Cardano's beta indicator, it measures the risk of Cardano and helps estimate the fluctuations that may happen in a short period of time. So if prices of Cardano fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Cardano is peer-to-peer digital currency powered by the Blockchain technology.

Cardano Investment Opportunity

Cardano has a volatility of 7.75 and is 10.47 times more volatile than DOW. 66  of all equities and portfolios are less risky than Cardano. Compared to the overall equity markets, volatility of historical daily returns of Cardano is higher than 66 () of all global equities and portfolios over the last 90 days. Use Cardano to enhance returns of your portfolios. The crypto coin experiences a large bullish trend. Check odds of Cardano to be traded at $1.441 in 90 days. . Let's try to break down what Cardano's beta means in this case. As the market becomes more bullish, returns on owning Cardano are expected to decrease slowly. On the other hand, during market turmoil, Cardano is expected to outperform it slightly.

Good diversification

The correlation between Cardano and DJI is Good diversification for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Cardano and DJI in the same portfolio assuming nothing else is changed.
Please note that Cardano is a digital instrument and cryptocurrency exchanges were notoriously volatile since the beginning of their establishment.

Cardano Additional Risk Indicators

The analysis of Cardano's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Cardano's investment and either accepting that risk or mitigating it. Along with some common measures of Cardano stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Risk Adjusted Performance0.0326
Market Risk Adjusted Performance(0.23)
Mean Deviation5.52
Semi Deviation7.24
Downside Deviation7.75
Coefficient Of Variation3119.93
Standard Deviation7.71
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Cardano Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Cardano as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Cardano's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Cardano's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Cardano.
Please continue to Trending Equities. Note that the Cardano information on this page should be used as a complementary analysis to other Cardano's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

Other Tools for Cardano Crypto Coin

When running Cardano price analysis, check to measure Cardano's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Cardano is operating at the current time. Most of Cardano's value examination focuses on studying past and present price action to predict the probability of Cardano's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Cardano's price. Additionally, you may evaluate how the addition of Cardano to your portfolios can decrease your overall portfolio volatility.
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