Correlation Between Golem Network and Ardor

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

Diversification Opportunities for Golem Network and Ardor

0.81
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Golem and Ardor is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Golem Network Token and Ardor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ardor and Golem Network 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 Golem Network Token are associated (or correlated) with Ardor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ardor has no effect on the direction of Golem Network i.e., Golem Network and Ardor go up and down completely randomly.

Pair Corralation between Golem Network and Ardor

Assuming the 90 days trading horizon Golem Network Token is expected to generate 0.73 times more return on investment than Ardor. However, Golem Network Token is 1.36 times less risky than Ardor. It trades about 0.28 of its potential returns per unit of risk. Ardor is currently generating about 0.18 per unit of risk. If you would invest  24.00  in Golem Network Token on May 16, 2022 and sell it today you would earn a total of  6.00  from holding Golem Network Token or generate 25.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy95.45%
ValuesDaily Returns

Golem Network Token  vs.  Ardor

 Performance (%) 
       Timeline  
Golem Network Token 
Golem Performance
4 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Golem Network Token are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak essential indicators, Golem Network sustained solid returns over the last few months and may actually be approaching a breakup point.

Golem Price Channel

Ardor 
Ardor Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Ardor are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental indicators, Ardor may actually be approaching a critical reversion point that can send shares even higher in September 2022.

Ardor Price Channel

Golem Network and Ardor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Golem Network and Ardor

The main advantage of trading using opposite Golem Network and Ardor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golem Network position performs unexpectedly, Ardor 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 Ardor will offset losses from the drop in Ardor's long position.
The idea behind Golem Network Token and Ardor 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.

Other Complementary Tools

Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Go
Analyst Recommendations
Analyst recommendations and target price estimates broken down by several categories
Go
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Go
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Go
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Go
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Go