Correlation Between Evolve Active and Evolve Cryptocurrencies

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

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

Diversification Opportunities for Evolve Active and Evolve Cryptocurrencies

-0.66

Correlation Coefficient

Evolve Active  Evolve Cryptocurrencies

Excellent diversification

The 3 months correlation between Evolve and Evolve is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Evolve Active Core and Evolve Cryptocurrencies ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolve Cryptocurrencies and Evolve Active 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 Evolve Active Core are associated (or correlated) with Evolve Cryptocurrencies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolve Cryptocurrencies has no effect on the direction of Evolve Active i.e., Evolve Active and Evolve Cryptocurrencies go up and down completely randomly.

Pair Corralation between Evolve Active and Evolve Cryptocurrencies

Assuming the 90 days trading horizon Evolve Active Core is expected to generate 0.11 times more return on investment than Evolve Cryptocurrencies. However, Evolve Active Core is 9.17 times less risky than Evolve Cryptocurrencies. It trades about 0.08 of its potential returns per unit of risk. Evolve Cryptocurrencies ETF is currently generating about -0.08 per unit of risk. If you would invest  1,795  in Evolve Active Core on December 30, 2024 and sell it today you would earn a total of  29.00  from holding Evolve Active Core or generate 1.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Evolve Active Core  vs.  Evolve Cryptocurrencies ETF

Evolve Active Core

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Evolve Active Core are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Evolve Active is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Evolve Cryptocurrencies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Evolve Cryptocurrencies ETF 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 Etf's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the ETF investors.

Pair Trading with Evolve Active and Evolve Cryptocurrencies

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

The idea behind Evolve Active Core and Evolve Cryptocurrencies ETF 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.