Correlation Between Basic Attention and KuCoin Token

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Can any of the company-specific risk be diversified away by investing in both Basic Attention and KuCoin Token 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 Basic Attention and KuCoin Token into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Basic Attention Token and KuCoin Token, you can compare the effects of market volatilities on Basic Attention and KuCoin Token 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 Basic Attention with a short position of KuCoin Token. Check out your portfolio center. Please also check ongoing floating volatility patterns of Basic Attention and KuCoin Token.

Diversification Opportunities for Basic Attention and KuCoin Token

0.9
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Basic and KuCoin is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Basic Attention Token and KuCoin Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KuCoin Token and Basic Attention 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 Basic Attention Token are associated (or correlated) with KuCoin Token. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KuCoin Token has no effect on the direction of Basic Attention i.e., Basic Attention and KuCoin Token go up and down completely randomly.

Pair Corralation between Basic Attention and KuCoin Token

Assuming the 90 days trading horizon Basic Attention is expected to generate 35.91 times less return on investment than KuCoin Token. But when comparing it to its historical volatility, Basic Attention Token is 15.62 times less risky than KuCoin Token. It trades about 0.03 of its potential returns per unit of risk. KuCoin Token is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  906.00  in KuCoin Token on December 29, 2023 and sell it today you would earn a total of  284.00  from holding KuCoin Token or generate 31.35% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Basic Attention Token  vs.  KuCoin Token

 Performance 
       Timeline  
Basic Attention Token 

Risk-Adjusted Performance

8 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Basic Attention Token are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Basic Attention exhibited solid returns over the last few months and may actually be approaching a breakup point.
KuCoin Token 

Risk-Adjusted Performance

5 of 100

 
Low
 
High
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in KuCoin Token are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, KuCoin Token exhibited solid returns over the last few months and may actually be approaching a breakup point.

Basic Attention and KuCoin Token Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Basic Attention and KuCoin Token

The main advantage of trading using opposite Basic Attention and KuCoin Token positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Basic Attention position performs unexpectedly, KuCoin Token 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 KuCoin Token will offset losses from the drop in KuCoin Token's long position.
The idea behind Basic Attention Token and KuCoin Token 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.
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

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