Correlation Between Binance Coin and LIV Capital
Can any of the company-specific risk be diversified away by investing in both Binance Coin and LIV Capital 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 Binance Coin and LIV Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binance Coin and LIV Capital Acquisition, you can compare the effects of market volatilities on Binance Coin and LIV Capital 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 Binance Coin with a short position of LIV Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binance Coin and LIV Capital.
Diversification Opportunities for Binance Coin and LIV Capital
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Binance and LIV is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Binance Coin and LIV Capital Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LIV Capital Acquisition and Binance Coin 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 Binance Coin are associated (or correlated) with LIV Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LIV Capital Acquisition has no effect on the direction of Binance Coin i.e., Binance Coin and LIV Capital go up and down completely randomly.
Pair Corralation between Binance Coin and LIV Capital
Assuming the 90 days trading horizon Binance Coin is expected to generate 0.53 times more return on investment than LIV Capital. However, Binance Coin is 1.88 times less risky than LIV Capital. It trades about 0.06 of its potential returns per unit of risk. LIV Capital Acquisition is currently generating about -0.06 per unit of risk. If you would invest 30,046 in Binance Coin on October 12, 2024 and sell it today you would earn a total of 38,724 from holding Binance Coin or generate 128.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 19.19% |
Values | Daily Returns |
Binance Coin vs. LIV Capital Acquisition
Performance |
Timeline |
Binance Coin |
LIV Capital Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Binance Coin and LIV Capital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Binance Coin and LIV Capital
The main advantage of trading using opposite Binance Coin and LIV Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binance Coin position performs unexpectedly, LIV Capital 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 LIV Capital will offset losses from the drop in LIV Capital's long position.Binance Coin vs. Staked Ether | Binance Coin vs. Cronos | Binance Coin vs. Wrapped Bitcoin | Binance Coin vs. Monero |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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