Correlation Between Grayscale Decentralized and Mako Mining

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

By analyzing existing cross correlation between Grayscale Decentralized Finance and Mako Mining Corp, you can compare the effects of market volatilities on Grayscale Decentralized and Mako Mining 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 Grayscale Decentralized with a short position of Mako Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Decentralized and Mako Mining.

Diversification Opportunities for Grayscale Decentralized and Mako Mining

-0.04

Correlation Coefficient

Grayscale Decentralized  Mako Mining

Good diversification

The 3 months correlation between Grayscale and Mako is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Decentralized Financ and Mako Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mako Mining Corp and Grayscale Decentralized 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 Grayscale Decentralized Finance are associated (or correlated) with Mako Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mako Mining Corp has no effect on the direction of Grayscale Decentralized i.e., Grayscale Decentralized and Mako Mining go up and down completely randomly.

Pair Corralation between Grayscale Decentralized and Mako Mining

Given the investment horizon of 90 days Grayscale Decentralized Finance is expected to generate 43.91 times more return on investment than Mako Mining. However, Grayscale Decentralized is 43.91 times more volatile than Mako Mining Corp. It trades about 0.13 of its potential returns per unit of risk. Mako Mining Corp is currently generating about 0.0 per unit of risk. If you would invest  2,105  in Grayscale Decentralized Finance on October 23, 2024 and sell it today you would earn a total of  1,775  from holding Grayscale Decentralized Finance or generate 84.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Grayscale Decentralized Financ  vs.  Mako Mining Corp

Grayscale Decentralized

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Grayscale Decentralized Finance are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Grayscale Decentralized reported solid returns over the last few months and may actually be approaching a breakup point.

Mako Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mako Mining Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Mako Mining is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Grayscale Decentralized and Mako Mining

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

The idea behind Grayscale Decentralized Finance and Mako Mining Corp 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.