Correlation Between ApeCoin and Uniswap Protocol

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

Diversification Opportunities for ApeCoin and Uniswap Protocol

0.85
  Correlation Coefficient

Very poor diversification

The 3 months correlation between ApeCoin and Uniswap is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding ApeCoin and Uniswap Protocol Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uniswap Protocol Token and ApeCoin 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 ApeCoin are associated (or correlated) with Uniswap Protocol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uniswap Protocol Token has no effect on the direction of ApeCoin i.e., ApeCoin and Uniswap Protocol go up and down completely randomly.

Pair Corralation between ApeCoin and Uniswap Protocol

Assuming the 90 days trading horizon ApeCoin is expected to generate 6.97 times more return on investment than Uniswap Protocol. However, ApeCoin is 6.97 times more volatile than Uniswap Protocol Token. It trades about 0.05 of its potential returns per unit of risk. Uniswap Protocol Token is currently generating about -0.06 per unit of risk. If you would invest  0.00  in ApeCoin on June 28, 2022 and sell it today you would earn a total of  566.00  from holding ApeCoin or generate 9.223372036854776E16% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy51.18%
ValuesDaily Returns

ApeCoin  vs.  Uniswap Protocol Token

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

ApeCoin Price Channel

Uniswap Protocol Token 
Uniswap Performance
0 of 100
Over the last 90 days Uniswap Protocol Token has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat weak basic indicators, Uniswap Protocol sustained solid returns over the last few months and may actually be approaching a breakup point.

ApeCoin and Uniswap Protocol Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with ApeCoin and Uniswap Protocol

The main advantage of trading using opposite ApeCoin and Uniswap Protocol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ApeCoin position performs unexpectedly, Uniswap Protocol 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 Uniswap Protocol will offset losses from the drop in Uniswap Protocol's long position.
ApeCoin vs. XRP
ApeCoin vs. Solana
ApeCoin vs. Polkadot
ApeCoin vs. Chainlink
The idea behind ApeCoin and Uniswap Protocol Token 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.
Uniswap Protocol vs. XRP
Uniswap Protocol vs. Solana
Uniswap Protocol vs. Polkadot
Uniswap Protocol vs. Chainlink
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 Transaction History module to view history of all your transactions and understand their impact on performance.

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