Correlation Between XCAD Network and EOS

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

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

Diversification Opportunities for XCAD Network and EOS

0.55

Correlation Coefficient

XCAD Network  EOS

Very weak diversification

The 3 months correlation between XCAD and EOS is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding XCAD Network and EOS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EOS and XCAD Network 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 XCAD Network are associated (or correlated) with EOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EOS has no effect on the direction of XCAD Network i.e., XCAD Network and EOS go up and down completely randomly.

Pair Corralation between XCAD Network and EOS

Assuming the 90 days trading horizon XCAD Network is expected to under-perform the EOS. But the crypto coin apears to be less risky and, when comparing its historical volatility, XCAD Network is 1.44 times less risky than EOS. The crypto coin trades about -0.37 of its potential returns per unit of risk. The EOS is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  97.00  in EOS on January 30, 2024 and sell it today you would lose (16.00) from holding EOS or give up 16.49% of portfolio value over 90 days.

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

XCAD Network  vs.  EOS

XCAD Network

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days XCAD Network has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Crypto's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for XCAD Network shareholders.

EOS

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in EOS are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, EOS exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with XCAD Network and EOS

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

The idea behind XCAD Network and EOS 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.