Correlation Between SwissBorg and Yearnfinance

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

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

Diversification Opportunities for SwissBorg and Yearnfinance

0.93

Correlation Coefficient

SwissBorg  Yearnfinance

Almost no diversification

The 3 months correlation between SwissBorg and Yearnfinance is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding SwissBorg and yearnfinance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on yearnfinance and SwissBorg 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 SwissBorg are associated (or correlated) with Yearnfinance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of yearnfinance has no effect on the direction of SwissBorg i.e., SwissBorg and Yearnfinance go up and down completely randomly.

Pair Corralation between SwissBorg and Yearnfinance

Assuming the 90 days trading horizon SwissBorg is expected to generate 1.3 times more return on investment than Yearnfinance. However, SwissBorg is 1.3 times more volatile than yearnfinance. It trades about 0.25 of its potential returns per unit of risk. yearnfinance is currently generating about 0.21 per unit of risk. If you would invest  15.00  in SwissBorg on September 2, 2024 and sell it today you would earn a total of  17.00  from holding SwissBorg or generate 113.33% return on investment over 90 days.

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

SwissBorg  vs.  yearnfinance

SwissBorg

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SwissBorg are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, SwissBorg exhibited solid returns over the last few months and may actually be approaching a breakup point.

yearnfinance

Risk-Adjusted Performance

16 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in yearnfinance are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady forward indicators, Yearnfinance exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SwissBorg and Yearnfinance

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

The idea behind SwissBorg and yearnfinance 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.