Correlation Between Tether and Origin Protocol

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

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

Diversification Opportunities for Tether and Origin Protocol

0.0

Correlation Coefficient

Tether  Origin Protocol

Pay attention - limited upside

The 3 months correlation between Tether and Origin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Tether and Origin Protocol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Protocol and Tether 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 Tether are associated (or correlated) with Origin Protocol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Protocol has no effect on the direction of Tether i.e., Tether and Origin Protocol go up and down completely randomly.

Pair Corralation between Tether and Origin Protocol

If you would invest  15.00  in Origin Protocol on January 24, 2024 and sell it today you would earn a total of  1.00  from holding Origin Protocol or generate 6.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Tether  vs.  Origin Protocol

Tether

Risk-Adjusted Performance

0 of 100

Very Weak

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

Origin Protocol

Risk-Adjusted Performance

3 of 100

Insignificant

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

Pair Trading with Tether and Origin Protocol

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

The idea behind Tether and Origin Protocol 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.