Correlation Between Dusk Network and XMX

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

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

Diversification Opportunities for Dusk Network and XMX

0.55

Correlation Coefficient

Dusk Network  XMX

Very weak diversification

The 3 months correlation between Dusk and XMX is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Dusk Network and XMX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XMX and Dusk Network 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 Dusk Network are associated (or correlated) with XMX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XMX has no effect on the direction of Dusk Network i.e., Dusk Network and XMX go up and down completely randomly.

Pair Corralation between Dusk Network and XMX

Assuming the 90 days trading horizon Dusk Network is expected to under-perform the XMX. In addition to that, Dusk Network is 1.48 times more volatile than XMX. It trades about -0.17 of its total potential returns per unit of risk. XMX is currently generating about -0.25 per unit of volatility. If you would invest  0.00  in XMX on February 7, 2024 and sell it today you would lose  0.00  from holding XMX or give up 25.0% of portfolio value over 90 days.

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

Dusk Network  vs.  XMX

Dusk Network

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Dusk Network are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Dusk Network exhibited solid returns over the last few months and may actually be approaching a breakup point.

XMX

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in XMX are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, XMX exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dusk Network and XMX

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

The idea behind Dusk Network and XMX 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 Commodity Directory module to find actively traded commodities issued by global exchanges.