Correlation Between Arweave and Automata

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

Diversification Opportunities for Arweave and Automata

0.22
  Correlation Coefficient

Modest diversification

The 3 months correlation between Arweave and Automata is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Arweave and Automata in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automata and Arweave 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 Arweave are associated (or correlated) with Automata. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automata has no effect on the direction of Arweave i.e., Arweave and Automata go up and down completely randomly.

Pair Corralation between Arweave and Automata

Assuming the 90 days horizon Arweave is expected to under-perform the Automata. But the crypto coin apears to be less risky and, when comparing its historical volatility, Arweave is 1.33 times less risky than Automata. The crypto coin trades about -0.11 of its potential returns per unit of risk. The Automata is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  17.00  in Automata on April 6, 2022 and sell it today you would lose (1.00)  from holding Automata or give up 5.88% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Arweave  vs.  Automata

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

Arweave Price Channel

Automata 
Automata Performance
9 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Automata are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Automata sustained solid returns over the last few months and may actually be approaching a breakup point.

Automata Price Channel

Arweave and Automata Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Arweave and Automata

The main advantage of trading using opposite Arweave and Automata positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arweave position performs unexpectedly, Automata 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 Automata will offset losses from the drop in Automata's long position.
The idea behind Arweave and Automata 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.

Other Complementary Tools

Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
Go
Focused Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Go
Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Go
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Go
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Go
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Go
Fund Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Go
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Go
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Go
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Go
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Go
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Go