Correlation Between Metalpha Technology and 36Kr Holdings

Can any of the company-specific risk be diversified away by investing in both Metalpha Technology and 36Kr Holdings 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 Metalpha Technology and 36Kr Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Metalpha Technology Holding and 36Kr Holdings, you can compare the effects of market volatilities on Metalpha Technology and 36Kr Holdings 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 Metalpha Technology with a short position of 36Kr Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metalpha Technology and 36Kr Holdings.

Diversification Opportunities for Metalpha Technology and 36Kr Holdings

0.44

Correlation Coefficient

Metalpha Technology  36Kr Holdings

Very weak diversification

The 3 months correlation between Metalpha and 36Kr is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Metalpha Technology Holding and 36Kr Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 36Kr Holdings and Metalpha Technology 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 Metalpha Technology Holding are associated (or correlated) with 36Kr Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 36Kr Holdings has no effect on the direction of Metalpha Technology i.e., Metalpha Technology and 36Kr Holdings go up and down completely randomly.

Pair Corralation between Metalpha Technology and 36Kr Holdings

Given the investment horizon of 90 days Metalpha Technology Holding is expected to generate 0.89 times more return on investment than 36Kr Holdings. However, Metalpha Technology Holding is 1.12 times less risky than 36Kr Holdings. It trades about -0.02 of its potential returns per unit of risk. 36Kr Holdings is currently generating about -0.09 per unit of risk. If you would invest  107.00  in Metalpha Technology Holding on September 2, 2024 and sell it today you would lose (17.00) from holding Metalpha Technology Holding or give up 15.89% of portfolio value over 90 days.

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

Metalpha Technology Holding  vs.  36Kr Holdings

Metalpha Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Metalpha Technology Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Etf's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the Etf traders.

36Kr Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 36Kr Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with sluggish performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Metalpha Technology and 36Kr Holdings

The main advantage of trading using opposite Metalpha Technology and 36Kr Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metalpha Technology position performs unexpectedly, 36Kr Holdings 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 36Kr Holdings will offset losses from the drop in 36Kr Holdings' long position.

The idea behind Metalpha Technology Holding and 36Kr Holdings 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.