Correlation Between LEO Token and Status Network
Can any of the company-specific risk be diversified away by investing in both LEO Token and Status Network 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 LEO Token and Status Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LEO Token and Status Network Token, you can compare the effects of market volatilities on LEO Token and Status Network 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 LEO Token with a short position of Status Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of LEO Token and Status Network.
Diversification Opportunities for LEO Token and Status Network
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LEO and Status is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding LEO Token and Status Network Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Status Network Token and LEO 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 LEO Token are associated (or correlated) with Status Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Status Network Token has no effect on the direction of LEO Token i.e., LEO Token and Status Network go up and down completely randomly.
Pair Corralation between LEO Token and Status Network
Assuming the 90 days trading horizon LEO Token is expected to generate 2.26 times less return on investment than Status Network. But when comparing it to its historical volatility, LEO Token is 2.27 times less risky than Status Network. It trades about 0.02 of its potential returns per unit of risk. Status Network Token is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 5.36 in Status Network Token on January 21, 2024 and sell it today you would lose (1.54) from holding Status Network Token or give up 28.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LEO Token vs. Status Network Token
Performance |
| Timeline |
| LEO Token |
| Status Network Token |
LEO Token and Status Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LEO Token and Status Network
The main advantage of trading using opposite LEO Token and Status Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LEO Token position performs unexpectedly, Status Network 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 Status Network will offset losses from the drop in Status Network's long position.The idea behind LEO Token and Status Network Token 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.| Status Network vs. Solana | Status Network vs. XRP | Status Network vs. The Open Network | Status Network vs. Staked Ether |
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.
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