Correlation Between Alchemy Pay and AirSwap

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

Diversification Opportunities for Alchemy Pay and AirSwap

0.8
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Alchemy and AirSwap is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Alchemy Pay and AirSwap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AirSwap and Alchemy Pay 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 Alchemy Pay are associated (or correlated) with AirSwap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AirSwap has no effect on the direction of Alchemy Pay i.e., Alchemy Pay and AirSwap go up and down completely randomly.

Pair Corralation between Alchemy Pay and AirSwap

Assuming the 90 days trading horizon Alchemy Pay is expected to under-perform the AirSwap. But the crypto coin apears to be less risky and, when comparing its historical volatility, Alchemy Pay is 1.61 times less risky than AirSwap. The crypto coin trades about -0.23 of its potential returns per unit of risk. The AirSwap is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest  13.00  in AirSwap on February 23, 2022 and sell it today you would lose (4.38)  from holding AirSwap or give up 33.69% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Alchemy Pay  vs.  AirSwap

 Performance (%) 
      Timeline 
Alchemy Pay 
Alchemy Performance
0 of 100
Over the last 90 days Alchemy Pay 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 fundamental indicators remain somewhat strong which may send shares a bit higher in June 2022. The current disturbance may also be a sign of long term up-swing for Alchemy Pay investors.

Alchemy Price Channel

AirSwap 
AirSwap Performance
0 of 100
Over the last 90 days AirSwap 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 June 2022. The current disturbance may also be a sign of long term up-swing for AirSwap investors.

AirSwap Price Channel

Alchemy Pay and AirSwap Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Alchemy Pay and AirSwap

The main advantage of trading using opposite Alchemy Pay and AirSwap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alchemy Pay position performs unexpectedly, AirSwap 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 AirSwap will offset losses from the drop in AirSwap's long position.
The idea behind Alchemy Pay and AirSwap 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

Other Complementary Tools

Commodity Channel Index
Use Commodity Channel Index to analyze current equity momentum
Go
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
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
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Analyst Recommendations
Analyst recommendations and target price estimates broken down by several categories
Go
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Go
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Go
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Go