Correlation Between Graph and Biconomy

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

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

Diversification Opportunities for Graph and Biconomy

0.98

Correlation Coefficient

Graph  Biconomy

Almost no diversification

The 3 months correlation between Graph and Biconomy is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding The Graph and Biconomy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biconomy and Graph 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 The Graph are associated (or correlated) with Biconomy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biconomy has no effect on the direction of Graph i.e., Graph and Biconomy go up and down completely randomly.

Pair Corralation between Graph and Biconomy

Assuming the 90 days trading horizon The Graph is expected to under-perform the Biconomy. But the crypto coin apears to be less risky and, when comparing its historical volatility, The Graph is 1.09 times less risky than Biconomy. The crypto coin trades about -0.06 of its potential returns per unit of risk. The Biconomy is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  27.00  in Biconomy on November 19, 2024 and sell it today you would lose (9.00) from holding Biconomy or give up 33.33% of portfolio value over 90 days.

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

The Graph  vs.  Biconomy

Graph

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Graph has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's basic indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for The Graph shareholders.

Biconomy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Biconomy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for Biconomy shareholders.

Pair Trading with Graph and Biconomy

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

The idea behind The Graph and Biconomy 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.