Correlation Between Siren Nasdaq and 21shares Core

Can any of the company-specific risk be diversified away by investing in both Siren Nasdaq and 21shares Core 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 Siren Nasdaq and 21shares Core into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Siren Nasdaq NexGen and 21shares Core Ethereum, you can compare the effects of market volatilities on Siren Nasdaq and 21shares Core 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 Siren Nasdaq with a short position of 21shares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siren Nasdaq and 21shares Core.

Diversification Opportunities for Siren Nasdaq and 21shares Core

0.71

Correlation Coefficient

Siren Nasdaq  21shares Core

Poor diversification

The 3 months correlation between Siren and 21shares is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Siren Nasdaq NexGen and 21shares Core Ethereum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21shares Core Ethereum and Siren Nasdaq 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 Siren Nasdaq NexGen are associated (or correlated) with 21shares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21shares Core Ethereum has no effect on the direction of Siren Nasdaq i.e., Siren Nasdaq and 21shares Core go up and down completely randomly.

Pair Corralation between Siren Nasdaq and 21shares Core

Given the investment horizon of 90 days Siren Nasdaq NexGen is expected to generate 0.38 times more return on investment than 21shares Core. However, Siren Nasdaq NexGen is 2.65 times less risky than 21shares Core. It trades about 0.1 of its potential returns per unit of risk. 21shares Core Ethereum is currently generating about -0.01 per unit of risk. If you would invest  2,636  in Siren Nasdaq NexGen on October 24, 2024 and sell it today you would earn a total of  73.00  from holding Siren Nasdaq NexGen or generate 2.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Siren Nasdaq NexGen  vs.  21shares Core Ethereum

Siren Nasdaq NexGen

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Siren Nasdaq NexGen are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting fundamental indicators, Siren Nasdaq may actually be approaching a critical reversion point that can send shares even higher in February 2025.

21shares Core Ethereum

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in 21shares Core Ethereum are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, 21shares Core demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Siren Nasdaq and 21shares Core

The main advantage of trading using opposite Siren Nasdaq and 21shares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siren Nasdaq position performs unexpectedly, 21shares Core 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 21shares Core will offset losses from the drop in 21shares Core's long position.

The idea behind Siren Nasdaq NexGen and 21shares Core Ethereum 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.