Correlation Between Cardano and Total Return

Can any of the company-specific risk be diversified away by investing in both Cardano and Total Return 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 Cardano and Total Return into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cardano and Total Return Strategy, you can compare the effects of market volatilities on Cardano and Total Return 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 Cardano with a short position of Total Return. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardano and Total Return.

Diversification Opportunities for Cardano and Total Return

0.0

Correlation Coefficient

Cardano  Total Return

Pay attention - limited upside

The 3 months correlation between Cardano and Total is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cardano and Total Return Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Total Return Strategy and Cardano 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 Cardano are associated (or correlated) with Total Return. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Total Return Strategy has no effect on the direction of Cardano i.e., Cardano and Total Return go up and down completely randomly.

Pair Corralation between Cardano and Total Return

If you would invest (100.00) in Total Return Strategy on December 21, 2024 and sell it today you would earn a total of  100.00  from holding Total Return Strategy or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Cardano  vs.  Total Return Strategy

Cardano

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cardano has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Crypto's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for Cardano shareholders.

Total Return Strategy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Total Return Strategy has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Total Return is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cardano and Total Return

The main advantage of trading using opposite Cardano and Total Return positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardano position performs unexpectedly, Total Return 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 Total Return will offset losses from the drop in Total Return's long position.

The idea behind Cardano and Total Return Strategy 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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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 the Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..