Correlation Between 21Shares Ethereum and WisdomTree Ethereum

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Can any of the company-specific risk be diversified away by investing in both 21Shares Ethereum and WisdomTree Ethereum 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 21Shares Ethereum and WisdomTree Ethereum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 21Shares Ethereum Staking and WisdomTree Ethereum ETC, you can compare the effects of market volatilities on 21Shares Ethereum and WisdomTree Ethereum 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 21Shares Ethereum with a short position of WisdomTree Ethereum. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Ethereum and WisdomTree Ethereum.

Diversification Opportunities for 21Shares Ethereum and WisdomTree Ethereum

21SharesWisdomTreeDiversified Away21SharesWisdomTreeDiversified Away100%
0.99
  Correlation Coefficient

No risk reduction

The 3 months correlation between 21Shares and WisdomTree is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Ethereum Staking and WisdomTree Ethereum ETC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Ethereum ETC and 21Shares Ethereum 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 21Shares Ethereum Staking are associated (or correlated) with WisdomTree Ethereum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Ethereum ETC has no effect on the direction of 21Shares Ethereum i.e., 21Shares Ethereum and WisdomTree Ethereum go up and down completely randomly.

Pair Corralation between 21Shares Ethereum and WisdomTree Ethereum

Assuming the 90 days trading horizon 21Shares Ethereum Staking is expected to under-perform the WisdomTree Ethereum. But the etf apears to be less risky and, when comparing its historical volatility, 21Shares Ethereum Staking is 1.04 times less risky than WisdomTree Ethereum. The etf trades about -0.35 of its potential returns per unit of risk. The WisdomTree Ethereum ETC is currently generating about -0.34 of returns per unit of risk over similar time horizon. If you would invest  3,043  in WisdomTree Ethereum ETC on December 2, 2024 and sell it today you would lose (1,070) from holding WisdomTree Ethereum ETC or give up 35.16% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

21Shares Ethereum Staking  vs.  WisdomTree Ethereum ETC

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -20-1001020
JavaScript chart by amCharts 3.21.15AETH-USD ETHW
       Timeline  
21Shares Ethereum Staking 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days 21Shares Ethereum Staking has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFebMar2530354045
WisdomTree Ethereum ETC 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days WisdomTree Ethereum ETC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Etf's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the fund sophisticated investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFebMar2022242628303234

21Shares Ethereum and WisdomTree Ethereum Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-7.83-5.86-3.9-1.93-0.03281.683.445.216.978.74 0.01700.01750.0180
JavaScript chart by amCharts 3.21.15AETH-USD ETHW
       Returns  

Pair Trading with 21Shares Ethereum and WisdomTree Ethereum

The main advantage of trading using opposite 21Shares Ethereum and WisdomTree Ethereum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Ethereum position performs unexpectedly, WisdomTree Ethereum 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 WisdomTree Ethereum will offset losses from the drop in WisdomTree Ethereum's long position.
The idea behind 21Shares Ethereum Staking and WisdomTree Ethereum ETC 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 CEOs Directory module to screen CEOs from public companies around the world.

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