Correlation Between Alephim and BakeryToken

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Alephim and BakeryToken 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 Alephim and BakeryToken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alephim and BakeryToken, you can compare the effects of market volatilities on Alephim and BakeryToken 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 Alephim with a short position of BakeryToken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alephim and BakeryToken.

Diversification Opportunities for Alephim and BakeryToken

0.17
  Correlation Coefficient

Average diversification

The 3 months correlation between Alephim and BakeryToken is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Aleph.im and BakeryToken in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BakeryToken and Alephim 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 Alephim are associated (or correlated) with BakeryToken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BakeryToken has no effect on the direction of Alephim i.e., Alephim and BakeryToken go up and down completely randomly.

Pair Corralation between Alephim and BakeryToken

Assuming the 90 days trading horizon Alephim is expected to generate 7.83 times more return on investment than BakeryToken. However, Alephim is 7.83 times more volatile than BakeryToken. It trades about 0.07 of its potential returns per unit of risk. BakeryToken is currently generating about -0.04 per unit of risk. If you would invest  68.00  in Alephim on April 8, 2022 and sell it today you would lose (42.00)  from holding Alephim or give up 61.76% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Aleph.im  vs.  BakeryToken

 Performance (%) 
      Timeline 
Alephim 
Alephim Performance
8 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Alephim are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Alephim sustained solid returns over the last few months and may actually be approaching a breakup point.

Alephim Price Channel

BakeryToken 
BakeryToken Performance
0 of 100
Over the last 90 days BakeryToken has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Crypto's forward-looking signals remain somewhat strong which may send shares a bit higher in August 2022. The current disturbance may also be a sign of long term up-swing for BakeryToken investors.

BakeryToken Price Channel

Alephim and BakeryToken Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Alephim and BakeryToken

The main advantage of trading using opposite Alephim and BakeryToken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alephim position performs unexpectedly, BakeryToken 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 BakeryToken will offset losses from the drop in BakeryToken's long position.
The idea behind Alephim and BakeryToken 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

Other Complementary Tools

Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Go
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Go
Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Go
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Go
ETF Directory
Find actively traded Exchange Traded Funds (ETF) from around the world
Go
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Go
Watchlist Optimization
Optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm
Go