Correlation Between Chia and PBAXW Old

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

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

Diversification Opportunities for Chia and PBAXW Old

-0.21

Correlation Coefficient

Chia  PBAXW Old

Very good diversification

The 3 months correlation between Chia and PBAXW is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Chia and PBAXW Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PBAXW Old and Chia 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 Chia are associated (or correlated) with PBAXW Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PBAXW Old has no effect on the direction of Chia i.e., Chia and PBAXW Old go up and down completely randomly.

Pair Corralation between Chia and PBAXW Old

If you would invest  1,621  in Chia on October 10, 2024 and sell it today you would earn a total of  588.00  from holding Chia or generate 36.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Chia  vs.  PBAXW Old

Chia

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Chia are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical indicators, Chia exhibited solid returns over the last few months and may actually be approaching a breakup point.

PBAXW Old

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PBAXW Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, PBAXW Old is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Chia and PBAXW Old

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

The idea behind Chia and PBAXW Old 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.