Correlation Between Polkadot and Chainlink

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

Diversification Opportunities for Polkadot and Chainlink

0.53
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Polkadot and Chainlink is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Polkadot and Chainlink in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chainlink and Polkadot 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 Polkadot are associated (or correlated) with Chainlink. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chainlink has no effect on the direction of Polkadot i.e., Polkadot and Chainlink go up and down completely randomly.

Pair Corralation between Polkadot and Chainlink

Assuming the 90 days trading horizon Polkadot is expected to under-perform the Chainlink. But the crypto coin apears to be less risky and, when comparing its historical volatility, Polkadot is 1.41 times less risky than Chainlink. The crypto coin trades about -0.09 of its potential returns per unit of risk. The Chainlink is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  666.00  in Chainlink on July 5, 2022 and sell it today you would earn a total of  74.00  from holding Chainlink or generate 11.11% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Polkadot  vs.  Chainlink

 Performance (%) 
       Timeline  
Polkadot 
Polkadot Performance
0 of 100
Over the last 90 days Polkadot 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 November 2022. The current disturbance may also be a sign of long term up-swing for Polkadot investors.

Polkadot Price Channel

Chainlink 
Chainlink Performance
5 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Chainlink are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Chainlink sustained solid returns over the last few months and may actually be approaching a breakup point.

Chainlink Price Channel

Polkadot and Chainlink Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Polkadot and Chainlink

The main advantage of trading using opposite Polkadot and Chainlink positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polkadot position performs unexpectedly, Chainlink 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 Chainlink will offset losses from the drop in Chainlink's long position.
Polkadot vs. XRP
Polkadot vs. Solana
Polkadot vs. Chainlink
Polkadot vs. Polygon
The idea behind Polkadot and Chainlink 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.
Chainlink vs. XRP
Chainlink vs. Solana
Chainlink vs. Polkadot
Chainlink vs. Polygon
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

Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Go
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Go
Global Correlations
Find global opportunities by holding instruments from different markets
Go
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Go
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Money Managers
Screen money managers from public funds and ETFs managed around the world
Go
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Go
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go