Correlation Between API3 and AdEx

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both API3 and AdEx 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 API3 and AdEx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between API3 and AdEx, you can compare the effects of market volatilities on API3 and AdEx 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 API3 with a short position of AdEx. Check out your portfolio center. Please also check ongoing floating volatility patterns of API3 and AdEx.

Diversification Opportunities for API3 and AdEx

0.91
  Correlation Coefficient

Almost no diversification

The 3 months correlation between API3 and AdEx is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding API3 and AdEx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AdEx and API3 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 API3 are associated (or correlated) with AdEx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AdEx has no effect on the direction of API3 i.e., API3 and AdEx go up and down completely randomly.

Pair Corralation between API3 and AdEx

Assuming the 90 days trading horizon API3 is expected to under-perform the AdEx. In addition to that, API3 is 1.48 times more volatile than AdEx. It trades about -0.21 of its total potential returns per unit of risk. AdEx is currently generating about -0.19 per unit of volatility. If you would invest  35.00  in AdEx on February 23, 2022 and sell it today you would lose (11.00)  from holding AdEx or give up 31.43% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

API3  vs.  AdEx

 Performance (%) 
      Timeline 
API3 
API3 Performance
0 of 100
Over the last 90 days API3 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 forward 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 API3 investors.

API3 Price Channel

AdEx 
AdEx Performance
0 of 100
Over the last 90 days AdEx 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 AdEx investors.

AdEx Price Channel

API3 and AdEx Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with API3 and AdEx

The main advantage of trading using opposite API3 and AdEx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if API3 position performs unexpectedly, AdEx 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 AdEx will offset losses from the drop in AdEx's long position.
The idea behind API3 and AdEx 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.

Other Complementary Tools

Stock Screener
Find equities using custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.
Go
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go
Commodity Channel Index
Use Commodity Channel Index to analyze current equity momentum
Go
Global Correlations
Find global opportunities by holding instruments from different markets
Go
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Go
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Transaction History
View history of all your transactions and understand their impact on performance
Go
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Go