Correlation Between Bit Origin and TDH Holdings

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

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

Diversification Opportunities for Bit Origin and TDH Holdings

-0.47

Correlation Coefficient

Bit Origin  TDH Holdings

Very good diversification

The 3 months correlation between Bit and TDH is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Bit Origin and TDH Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TDH Holdings and Bit Origin 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 Bit Origin are associated (or correlated) with TDH Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TDH Holdings has no effect on the direction of Bit Origin i.e., Bit Origin and TDH Holdings go up and down completely randomly.

Pair Corralation between Bit Origin and TDH Holdings

Given the investment horizon of 90 days Bit Origin is expected to under-perform the TDH Holdings. In addition to that, Bit Origin is 4.66 times more volatile than TDH Holdings. It trades about -0.03 of its total potential returns per unit of risk. TDH Holdings is currently generating about 0.06 per unit of volatility. If you would invest  120.00  in TDH Holdings on December 26, 2024 and sell it today you would earn a total of  13.00  from holding TDH Holdings or generate 10.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Bit Origin  vs.  TDH Holdings

Bit Origin

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bit Origin has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

TDH Holdings

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in TDH Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, TDH Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bit Origin and TDH Holdings

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

The idea behind Bit Origin and TDH Holdings 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.