Correlation Between Harvest Diversified and Harvest Coinbase

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

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

Diversification Opportunities for Harvest Diversified and Harvest Coinbase

0.95

Correlation Coefficient

Harvest Diversified  Harvest Coinbase

Almost no diversification

The 3 months correlation between Harvest and Harvest is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Harvest Diversified High and Harvest Coinbase Enhanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvest Coinbase Enhanced and Harvest Diversified 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 Harvest Diversified High are associated (or correlated) with Harvest Coinbase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvest Coinbase Enhanced has no effect on the direction of Harvest Diversified i.e., Harvest Diversified and Harvest Coinbase go up and down completely randomly.

Pair Corralation between Harvest Diversified and Harvest Coinbase

Assuming the 90 days trading horizon Harvest Diversified is expected to generate 4.28 times less return on investment than Harvest Coinbase. But when comparing it to its historical volatility, Harvest Diversified High is 2.0 times less risky than Harvest Coinbase. It trades about 0.05 of its potential returns per unit of risk. Harvest Coinbase Enhanced is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  1,145  in Harvest Coinbase Enhanced on April 25, 2025 and sell it today you would earn a total of  715.00  from holding Harvest Coinbase Enhanced or generate 62.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	74.81%
Values	Daily Returns

Harvest Diversified High  vs.  Harvest Coinbase Enhanced

Harvest Diversified High

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Harvest Diversified High are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Harvest Diversified displayed solid returns over the last few months and may actually be approaching a breakup point.

Harvest Coinbase Enhanced

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Harvest Coinbase Enhanced are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Harvest Coinbase displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Harvest Diversified and Harvest Coinbase

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

The idea behind Harvest Diversified High and Harvest Coinbase Enhanced 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.