Correlation Between Worldcoin and CVC

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

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

Diversification Opportunities for Worldcoin and CVC

0.82

Correlation Coefficient

Worldcoin  CVC

Very poor diversification

The 3 months correlation between Worldcoin and CVC is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Worldcoin and CVC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVC and Worldcoin 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 Worldcoin are associated (or correlated) with CVC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVC has no effect on the direction of Worldcoin i.e., Worldcoin and CVC go up and down completely randomly.

Pair Corralation between Worldcoin and CVC

Assuming the 90 days trading horizon Worldcoin is expected to generate 1.18 times more return on investment than CVC. However, Worldcoin is 1.18 times more volatile than CVC. It trades about 0.1 of its potential returns per unit of risk. CVC is currently generating about 0.03 per unit of risk. If you would invest  86.00  in Worldcoin on April 22, 2025 and sell it today you would earn a total of  29.00  from holding Worldcoin or generate 33.72% return on investment over 90 days.

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

Worldcoin  vs.  CVC

Worldcoin

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Worldcoin are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Worldcoin exhibited solid returns over the last few months and may actually be approaching a breakup point.

CVC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CVC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, CVC may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Worldcoin and CVC

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

The idea behind Worldcoin and CVC 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.