Correlation Between Hyperliquid and Thorchain

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

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

Diversification Opportunities for Hyperliquid and Thorchain

-0.02

Correlation Coefficient

Hyperliquid  Thorchain

Good diversification

The 3 months correlation between Hyperliquid and Thorchain is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Hyperliquid and Thorchain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thorchain and Hyperliquid 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 Hyperliquid are associated (or correlated) with Thorchain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thorchain has no effect on the direction of Hyperliquid i.e., Hyperliquid and Thorchain go up and down completely randomly.

Pair Corralation between Hyperliquid and Thorchain

Assuming the 90 days trading horizon Hyperliquid is expected to generate 21.66 times more return on investment than Thorchain. However, Hyperliquid is 21.66 times more volatile than Thorchain. It trades about 0.12 of its potential returns per unit of risk. Thorchain is currently generating about 0.08 per unit of risk. If you would invest  1,921  in Hyperliquid on April 20, 2025 and sell it today you would earn a total of  2,473  from holding Hyperliquid or generate 128.74% return on investment over 90 days.

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

Hyperliquid  vs.  Thorchain

Hyperliquid

Risk-Adjusted Performance

OK

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

Thorchain

Risk-Adjusted Performance

Modest

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

Pair Trading with Hyperliquid and Thorchain

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

The idea behind Hyperliquid and Thorchain 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.