Correlation Between KuCoin Token and Litecoin

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both KuCoin Token and Litecoin 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 KuCoin Token and Litecoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KuCoin Token and Litecoin, you can compare the effects of market volatilities on KuCoin Token and Litecoin 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 KuCoin Token with a short position of Litecoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of KuCoin Token and Litecoin.

Diversification Opportunities for KuCoin Token and Litecoin

0.89
  Correlation Coefficient

Very poor diversification

The 3 months correlation between KuCoin and Litecoin is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding KuCoin Token and Litecoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Litecoin and KuCoin 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 KuCoin Token are associated (or correlated) with Litecoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Litecoin has no effect on the direction of KuCoin Token i.e., KuCoin Token and Litecoin go up and down completely randomly.

Pair Corralation between KuCoin Token and Litecoin

Assuming the 90 days trading horizon KuCoin Token is expected to generate 1.98 times less return on investment than Litecoin. In addition to that, KuCoin Token is 1.18 times more volatile than Litecoin. It trades about 0.07 of its total potential returns per unit of risk. Litecoin is currently generating about 0.15 per unit of volatility. If you would invest  7,994  in Litecoin on December 30, 2023 and sell it today you would earn a total of  1,433  from holding Litecoin or generate 17.93% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

KuCoin Token  vs.  Litecoin

 Performance 
       Timeline  
KuCoin Token 

Risk-Adjusted Performance

6 of 100

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

Risk-Adjusted Performance

12 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Litecoin are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Litecoin exhibited solid returns over the last few months and may actually be approaching a breakup point.

KuCoin Token and Litecoin Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with KuCoin Token and Litecoin

The main advantage of trading using opposite KuCoin Token and Litecoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KuCoin Token position performs unexpectedly, Litecoin 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 Litecoin will offset losses from the drop in Litecoin's long position.
The idea behind KuCoin Token and Litecoin 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

Other Complementary Tools

Share Portfolio
Track or share privately all of your investments from the convenience of any device
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios