Correlation Between First BITCoin and SPENN Technology

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

By analyzing existing cross correlation between First BITCoin Capital and SPENN Technology AS, you can compare the effects of market volatilities on First BITCoin and SPENN Technology 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 First BITCoin with a short position of SPENN Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of First BITCoin and SPENN Technology.

Diversification Opportunities for First BITCoin and SPENN Technology

0.0

Correlation Coefficient

First BITCoin  SPENN Technology

Pay attention - limited upside

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

Pair Corralation between First BITCoin and SPENN Technology

Assuming the 90 days horizon First BITCoin Capital is expected to generate 56.09 times more return on investment than SPENN Technology. However, First BITCoin is 56.09 times more volatile than SPENN Technology AS. It trades about 0.14 of its potential returns per unit of risk. SPENN Technology AS is currently generating about -0.06 per unit of risk. If you would invest  0.19  in First BITCoin Capital on December 2, 2024 and sell it today you would lose (0.16) from holding First BITCoin Capital or give up 84.21% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	97.18%
Values	Daily Returns

First BITCoin Capital  vs.  SPENN Technology AS

First BITCoin Capital

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in First BITCoin Capital are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental indicators, First BITCoin reported solid returns over the last few months and may actually be approaching a breakup point.

SPENN Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days SPENN Technology AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SPENN Technology is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with First BITCoin and SPENN Technology

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

The idea behind First BITCoin Capital and SPENN Technology AS 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 the Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.