Correlation Between Aragon and BakeryToken

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

Diversification Opportunities for Aragon and BakeryToken

0.99
  Correlation Coefficient

No risk reduction

The 3 months correlation between Aragon and BakeryToken is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Aragon and BakeryToken in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BakeryToken and Aragon 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 Aragon 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 Aragon i.e., Aragon and BakeryToken go up and down completely randomly.

Pair Corralation between Aragon and BakeryToken

Assuming the 90 days trading horizon Aragon is expected to generate 1.49 times more return on investment than BakeryToken. However, Aragon is 1.49 times more volatile than BakeryToken. It trades about 0.03 of its potential returns per unit of risk. BakeryToken is currently generating about -0.1 per unit of risk. If you would invest  183.00  in Aragon on April 8, 2022 and sell it today you would lose (12.00)  from holding Aragon or give up 6.56% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Aragon  vs.  BakeryToken

 Performance (%) 
      Timeline 
Aragon 
Aragon Performance
0 of 100
Over the last 90 days Aragon 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 basic 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 Aragon investors.

Aragon 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

Aragon and BakeryToken Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Aragon and BakeryToken

The main advantage of trading using opposite Aragon and BakeryToken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aragon 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 Aragon 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

Other Complementary Tools

Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Focused Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Go
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Go
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Go
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Go
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Go
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Go
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Go
Piotroski F Score
Get Piotroski F Score based on binary analysis strategy of nine different fundamentals
Go