Correlation Between Gatechain Token and STEPN

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

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

Diversification Opportunities for Gatechain Token and STEPN

0.79

Correlation Coefficient

Gatechain Token  STEPN

Poor diversification

The 3 months correlation between Gatechain and STEPN is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Gatechain Token and STEPN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STEPN and Gatechain Token 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 Gatechain Token are associated (or correlated) with STEPN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STEPN has no effect on the direction of Gatechain Token i.e., Gatechain Token and STEPN go up and down completely randomly.

Pair Corralation between Gatechain Token and STEPN

Assuming the 90 days horizon Gatechain Token is expected to under-perform the STEPN. But the crypto coin apears to be less risky and, when comparing its historical volatility, Gatechain Token is 2.25 times less risky than STEPN. The crypto coin trades about -0.17 of its potential returns per unit of risk. The STEPN is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  5.63  in STEPN on April 24, 2025 and sell it today you would earn a total of  0.19  from holding STEPN or generate 3.37% return on investment over 90 days.

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

Gatechain Token  vs.  STEPN

Gatechain Token

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gatechain Token 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 Gatechain Token shareholders.

STEPN

Risk-Adjusted Performance

Weak

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

Pair Trading with Gatechain Token and STEPN

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

The idea behind Gatechain Token and STEPN 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.