Correlation Between Chiliz and AE

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

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

Diversification Opportunities for Chiliz and AE

0.57

Correlation Coefficient

Chiliz  AE

Very weak diversification

The 3 months correlation between Chiliz and AE is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Chiliz and AE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AE and Chiliz 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 Chiliz are associated (or correlated) with AE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AE has no effect on the direction of Chiliz i.e., Chiliz and AE go up and down completely randomly.

Pair Corralation between Chiliz and AE

Assuming the 90 days trading horizon Chiliz is expected to generate 0.52 times more return on investment than AE. However, Chiliz is 1.91 times less risky than AE. It trades about 0.03 of its potential returns per unit of risk. AE is currently generating about -0.18 per unit of risk. If you would invest  4.05  in Chiliz on April 20, 2025 and sell it today you would earn a total of  0.16  from holding Chiliz or generate 3.95% return on investment over 90 days.

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

Chiliz  vs.  AE

Chiliz

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Chiliz are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Chiliz may actually be approaching a critical reversion point that can send shares even higher in August 2025.

AE

Risk-Adjusted Performance

Very Weak

Over the last 90 days AE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in August 2025. The latest tumult may also be a sign of longer-term up-swing for AE shareholders.

Pair Trading with Chiliz and AE

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

The idea behind Chiliz and AE 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.