Correlation Between Mast Global and REX Crypto

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

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

Diversification Opportunities for Mast Global and REX Crypto

0.13

Correlation Coefficient

Mast Global  REX Crypto

Average diversification

The 3 months correlation between Mast and REX is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Mast Global Battery and REX Crypto Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REX Crypto Equity and Mast Global 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 Mast Global Battery are associated (or correlated) with REX Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REX Crypto Equity has no effect on the direction of Mast Global i.e., Mast Global and REX Crypto go up and down completely randomly.

Pair Corralation between Mast Global and REX Crypto

Allowing for the 90-day total investment horizon Mast Global Battery is expected to generate 0.47 times more return on investment than REX Crypto. However, Mast Global Battery is 2.13 times less risky than REX Crypto. It trades about -0.01 of its potential returns per unit of risk. REX Crypto Equity is currently generating about -0.1 per unit of risk. If you would invest  2,511  in Mast Global Battery on December 17, 2024 and sell it today you would lose (27.00) from holding Mast Global Battery or give up 1.08% of portfolio value over 90 days.

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

Mast Global Battery  vs.  REX Crypto Equity

Mast Global Battery

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mast Global Battery has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Mast Global is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

REX Crypto Equity

Risk-Adjusted Performance

Very Weak

Over the last 90 days REX Crypto Equity has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Etf's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the Etf traders.

Pair Trading with Mast Global and REX Crypto

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

The idea behind Mast Global Battery and REX Crypto Equity 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.