Correlation Between Flare and OpenLedger

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

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

Diversification Opportunities for Flare and OpenLedger

0.35

Correlation Coefficient

Flare  OpenLedger

Weak diversification

The 3 months correlation between Flare and OpenLedger is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Flare and OpenLedger in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OpenLedger and Flare 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 Flare are associated (or correlated) with OpenLedger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OpenLedger has no effect on the direction of Flare i.e., Flare and OpenLedger go up and down completely randomly.

Pair Corralation between Flare and OpenLedger

Assuming the 90 days trading horizon Flare is expected to under-perform the OpenLedger. But the crypto coin apears to be less risky and, when comparing its historical volatility, Flare is 28.52 times less risky than OpenLedger. The crypto coin trades about -0.09 of its potential returns per unit of risk. The OpenLedger is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  0.39  in OpenLedger on July 19, 2025 and sell it today you would earn a total of  35.61  from holding OpenLedger or generate 9060.31% return on investment over 90 days.

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

Flare  vs.  OpenLedger

Flare

Risk-Adjusted Performance

Weakest

Over the last 90 days Flare 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 basic indicators remain rather sound which may send shares a bit higher in November 2025. The latest tumult may also be a sign of longer-term up-swing for Flare shareholders.

OpenLedger

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in OpenLedger are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, OpenLedger exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Flare and OpenLedger

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

The idea behind Flare and OpenLedger 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.