Correlation Between Hedera Hashgraph and MTA

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

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

Diversification Opportunities for Hedera Hashgraph and MTA

-0.15

Correlation Coefficient

Hedera Hashgraph  MTA

Good diversification

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

Pair Corralation between Hedera Hashgraph and MTA

Assuming the 90 days trading horizon Hedera Hashgraph is expected to under-perform the MTA. But the crypto coin apears to be less risky and, when comparing its historical volatility, Hedera Hashgraph is 3.4 times less risky than MTA. The crypto coin trades about -0.09 of its potential returns per unit of risk. The MTA is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1.99  in MTA on December 29, 2024 and sell it today you would lose (0.30) from holding MTA or give up 15.08% of portfolio value over 90 days.

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

Hedera Hashgraph  vs.  MTA

Hedera Hashgraph

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hedera Hashgraph 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 April 2025. The latest tumult may also be a sign of longer-term up-swing for Hedera Hashgraph shareholders.

MTA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MTA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, MTA exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hedera Hashgraph and MTA

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

The idea behind Hedera Hashgraph and MTA 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.