Correlation Between KuCoin Token and ZCash

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

By analyzing existing cross correlation between KuCoin Token and ZCash, you can compare the effects of market volatilities on KuCoin Token and ZCash 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 ZCash. Check out your portfolio center. Please also check ongoing floating volatility patterns of KuCoin Token and ZCash.

Diversification Opportunities for KuCoin Token and ZCash

0.83

Correlation Coefficient

KuCoin Token  ZCash

Very poor diversification

The 3 months correlation between KuCoin and ZCash is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding KuCoin Token and ZCash in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZCash 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 ZCash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZCash has no effect on the direction of KuCoin Token i.e., KuCoin Token and ZCash go up and down completely randomly.

Pair Corralation between KuCoin Token and ZCash

Assuming the 90 days trading horizon KuCoin Token is expected to under-perform the ZCash. In addition to that, KuCoin Token is 1.12 times more volatile than ZCash. It trades about -0.36 of its total potential returns per unit of risk. ZCash is currently generating about -0.21 per unit of volatility. If you would invest  2,876  in ZCash on January 21, 2024 and sell it today you would lose (642.00) from holding ZCash or give up 22.32% of portfolio value over 90 days.

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

KuCoin Token  vs.  ZCash

KuCoin Token

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KuCoin Token has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, KuCoin Token is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

ZCash

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ZCash are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, ZCash exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KuCoin Token and ZCash

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

The idea behind KuCoin Token and ZCash 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.