Correlation Between Algorand and BitMart Token

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

Diversification Opportunities for Algorand and BitMart Token

0.84
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Algorand and BitMart is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Algorand and BitMart Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BitMart Token and Algorand 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 Algorand are associated (or correlated) with BitMart Token. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BitMart Token has no effect on the direction of Algorand i.e., Algorand and BitMart Token go up and down completely randomly.

Pair Corralation between Algorand and BitMart Token

Assuming the 90 days trading horizon Algorand is expected to under-perform the BitMart Token. But the crypto coin apears to be less risky and, when comparing its historical volatility, Algorand is 1.29 times less risky than BitMart Token. The crypto coin trades about -0.23 of its potential returns per unit of risk. The BitMart Token is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  29.00  in BitMart Token on April 6, 2022 and sell it today you would lose (8.00)  from holding BitMart Token or give up 27.59% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Algorand  vs.  BitMart Token

 Performance (%) 
      Timeline 
Algorand 
Algorand Performance
0 of 100
Over the last 90 days Algorand 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 technical and fundamental indicators 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 Algorand investors.

Algorand Price Channel

BitMart Token 
BitMart Performance
0 of 100
Over the last 90 days BitMart Token has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Crypto's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for BitMart Token investors.

BitMart Price Channel

Algorand and BitMart Token Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Algorand and BitMart Token

The main advantage of trading using opposite Algorand and BitMart Token positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Algorand position performs unexpectedly, BitMart Token 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 BitMart Token will offset losses from the drop in BitMart Token's long position.
The idea behind Algorand and BitMart Token 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

Other Complementary Tools

Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Go
Fundamental Analysis
View fundamental data based on most recent published financial statements
Go
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Go
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Go
Price Transformation
Use Price Transformation models to analyze depth of different equity instruments across global markets
Go
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go