The DeFi Liquidity Provider has a good data tool worth following. A feature of the correlation matrix launched by a certain data platform updates daily, allowing for precise calculation of the correlation coefficient between assets, ranging from -1 to 1. A coefficient of 1 represents a perfectly positive correlation (the price movements of the two assets are consistent), while -1 indicates a perfectly negative correlation (the price movements are opposite).

The most practical aspect of this tool is its time flexibility. Liquidity Providers can switch between weekly, monthly, or yearly dimensions to view the data as needed. This way, whether you want to study short-term liquidity position allocation or plan long-term exposure management, you can find the correlation changes based on different time frames. It is particularly helpful for optimizing capital allocation and reducing portfolio volatility.