Correlation Between Tesla and Boson Protocol

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

Diversification Opportunities for Tesla and Boson Protocol

0.49
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Tesla and Boson is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Tesla Inc and Boson Protocol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boson Protocol and Tesla 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 Tesla Inc are associated (or correlated) with Boson Protocol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boson Protocol has no effect on the direction of Tesla i.e., Tesla and Boson Protocol go up and down completely randomly.

Pair Corralation between Tesla and Boson Protocol

Given the investment horizon of 90 days Tesla Inc is expected to generate 0.5 times more return on investment than Boson Protocol. However, Tesla Inc is 1.98 times less risky than Boson Protocol. It trades about -0.09 of its potential returns per unit of risk. Boson Protocol is currently generating about -0.12 per unit of risk. If you would invest  30,059  in Tesla Inc on July 3, 2022 and sell it today you would lose (3,534)  from holding Tesla Inc or give up 11.76% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Tesla Inc  vs.  Boson Protocol

 Performance (%) 
       Timeline  
Tesla Inc 
Tesla Performance
6 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Tesla Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting essential indicators, Tesla sustained solid returns over the last few months and may actually be approaching a breakup point.

Tesla Price Channel

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

Boson Price Channel

Tesla and Boson Protocol Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Tesla and Boson Protocol

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

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