Correlation Between Ondo and FileCoin

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

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

Diversification Opportunities for Ondo and FileCoin

0.94

Correlation Coefficient

Ondo  FileCoin

Almost no diversification

The 3 months correlation between Ondo and FileCoin is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Ondo and FileCoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FileCoin and Ondo 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 Ondo are associated (or correlated) with FileCoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FileCoin has no effect on the direction of Ondo i.e., Ondo and FileCoin go up and down completely randomly.

Pair Corralation between Ondo and FileCoin

Assuming the 90 days trading horizon Ondo is expected to generate 1.16 times more return on investment than FileCoin. However, Ondo is 1.16 times more volatile than FileCoin. It trades about 0.06 of its potential returns per unit of risk. FileCoin is currently generating about 0.02 per unit of risk. If you would invest  92.00  in Ondo on April 22, 2025 and sell it today you would earn a total of  11.00  from holding Ondo or generate 11.96% return on investment over 90 days.

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

Ondo  vs.  FileCoin

Ondo

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ondo are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Ondo exhibited solid returns over the last few months and may actually be approaching a breakup point.

FileCoin

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FileCoin are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound essential indicators, FileCoin is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Ondo and FileCoin

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

The idea behind Ondo and FileCoin 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..