Correlation Between Coin Citadel and Appswarm

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

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

Diversification Opportunities for Coin Citadel and Appswarm

-0.15

Correlation Coefficient

Coin Citadel  Appswarm

Good diversification

The 3 months correlation between Coin and Appswarm is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Coin Citadel and Appswarm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Appswarm and Coin Citadel 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 Coin Citadel are associated (or correlated) with Appswarm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Appswarm has no effect on the direction of Coin Citadel i.e., Coin Citadel and Appswarm go up and down completely randomly.

Pair Corralation between Coin Citadel and Appswarm

Given the investment horizon of 90 days Coin Citadel is expected to generate 8.39 times more return on investment than Appswarm. However, Coin Citadel is 8.39 times more volatile than Appswarm. It trades about 0.11 of its potential returns per unit of risk. Appswarm is currently generating about 0.07 per unit of risk. If you would invest  0.05  in Coin Citadel on September 4, 2024 and sell it today you would lose (0.04) from holding Coin Citadel or give up 80.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Coin Citadel  vs.  Appswarm

Coin Citadel

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Coin Citadel are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, Coin Citadel disclosed solid returns over the last few months and may actually be approaching a breakup point.

Appswarm

Risk-Adjusted Performance

5 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Appswarm are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Appswarm displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Coin Citadel and Appswarm

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

The idea behind Coin Citadel and Appswarm 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.