Correlation Between USD Coin and FTX Token

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

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

Diversification Opportunities for USD Coin and FTX Token

0.0

Correlation Coefficient

USD Coin  FTX Token

Pay attention - limited upside

The 3 months correlation between USD and FTX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding USD Coin and FTX Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FTX Token and USD Coin 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 USD Coin are associated (or correlated) with FTX Token. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FTX Token has no effect on the direction of USD Coin i.e., USD Coin and FTX Token go up and down completely randomly.

Pair Corralation between USD Coin and FTX Token

If you would invest  100.00  in USD Coin on December 29, 2024 and sell it today you would earn a total of  0.00  from holding USD Coin or generate 0.0% return on investment over 90 days.

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

USD Coin  vs.  FTX Token

USD Coin

Risk-Adjusted Performance

Very Weak

Over the last 90 days USD Coin has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, USD Coin is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

FTX Token

Risk-Adjusted Performance

Very Weak

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

Pair Trading with USD Coin and FTX Token

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

The idea behind USD Coin and FTX Token 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.

Check out your portfolio center.

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 Bonds Directory module to find actively traded corporate debentures issued by US companies.