Correlation Between THC and XCAD Network
Can any of the company-specific risk be diversified away by investing in both THC and XCAD 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 THC and XCAD Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THC and XCAD Network, you can compare the effects of market volatilities on THC and XCAD 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 THC with a short position of XCAD Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of THC and XCAD Network.
Diversification Opportunities for THC and XCAD Network
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between THC and XCAD is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding THC and XCAD Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XCAD Network and THC 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 THC are associated (or correlated) with XCAD Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XCAD Network has no effect on the direction of THC i.e., THC and XCAD Network go up and down completely randomly.
Pair Corralation between THC and XCAD Network
Assuming the 90 days trading horizon THC is expected to generate 4.68 times more return on investment than XCAD Network. However, THC is 4.68 times more volatile than XCAD Network. It trades about 0.03 of its potential returns per unit of risk. XCAD Network is currently generating about -0.42 per unit of risk. If you would invest 0.28 in THC on January 29, 2024 and sell it today you would lose (0.09) from holding THC or give up 31.67% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
THC vs. XCAD Network
Performance |
Timeline |
THC |
XCAD Network |
THC and XCAD Network Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with THC and XCAD Network
The main advantage of trading using opposite THC and XCAD Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THC position performs unexpectedly, XCAD 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 XCAD Network will offset losses from the drop in XCAD Network's long position.The idea behind THC and XCAD Network 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.XCAD Network vs. Solana | XCAD Network vs. XRP | XCAD Network vs. Staked Ether | XCAD Network vs. The Open Network |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Fundamental Analysis View fundamental data based on most recent published financial statements |