Correlation Between Crypto and Xalles Holdings

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

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

Diversification Opportunities for Crypto and Xalles Holdings

0.15

Correlation Coefficient

Crypto  Xalles Holdings

Average diversification

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

Pair Corralation between Crypto and Xalles Holdings

Given the investment horizon of 90 days Crypto Co is expected to generate 1.92 times more return on investment than Xalles Holdings. However, Crypto is 1.92 times more volatile than Xalles Holdings. It trades about 0.05 of its potential returns per unit of risk. Xalles Holdings is currently generating about 0.03 per unit of risk. If you would invest  21.00  in Crypto Co on September 4, 2024 and sell it today you would lose (20.93) from holding Crypto Co or give up 99.67% of portfolio value over 90 days.

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

Crypto Co  vs.  Xalles Holdings

Crypto

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Crypto Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Xalles Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Xalles Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Crypto and Xalles Holdings

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

The idea behind Crypto Co and Xalles 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.

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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.