Correlation Between Morpho and Movement

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

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

Diversification Opportunities for Morpho and Movement

-0.43

Correlation Coefficient

Morpho  Movement

Very good diversification

The 3 months correlation between Morpho and Movement is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Morpho and Movement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Movement and Morpho 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 Morpho are associated (or correlated) with Movement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Movement has no effect on the direction of Morpho i.e., Morpho and Movement go up and down completely randomly.

Pair Corralation between Morpho and Movement

Assuming the 90 days trading horizon Morpho is expected to generate 0.86 times more return on investment than Movement. However, Morpho is 1.17 times less risky than Movement. It trades about 0.18 of its potential returns per unit of risk. Movement is currently generating about -0.06 per unit of risk. If you would invest  86.00  in Morpho on April 15, 2025 and sell it today you would earn a total of  81.00  from holding Morpho or generate 94.19% return on investment over 90 days.

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

Morpho  vs.  Movement

Morpho

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Morpho are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, Morpho sustained solid returns over the last few months and may actually be approaching a breakup point.

Movement

Risk-Adjusted Performance

Very Weak

Over the last 90 days Movement has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in August 2025. The latest tumult may also be a sign of longer-term up-swing for Movement shareholders.

Pair Trading with Morpho and Movement

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

The idea behind Morpho and Movement 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.