Correlation Between Grayscale Bitcoin and Galaxy Digital
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and Galaxy Digital 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 Grayscale Bitcoin and Galaxy Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grayscale Bitcoin Cash and Galaxy Digital Holdings, you can compare the effects of market volatilities on Grayscale Bitcoin and Galaxy Digital 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 Grayscale Bitcoin with a short position of Galaxy Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and Galaxy Digital.
Diversification Opportunities for Grayscale Bitcoin and Galaxy Digital
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grayscale and Galaxy is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Cash and Galaxy Digital Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galaxy Digital Holdings and Grayscale Bitcoin 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 Grayscale Bitcoin Cash are associated (or correlated) with Galaxy Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galaxy Digital Holdings has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and Galaxy Digital go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and Galaxy Digital
Given the investment horizon of 90 days Grayscale Bitcoin Cash is expected to generate 1.66 times more return on investment than Galaxy Digital. However, Grayscale Bitcoin is 1.66 times more volatile than Galaxy Digital Holdings. It trades about 0.09 of its potential returns per unit of risk. Galaxy Digital Holdings is currently generating about 0.1 per unit of risk. If you would invest 230.00 in Grayscale Bitcoin Cash on August 26, 2024 and sell it today you would earn a total of 449.00 from holding Grayscale Bitcoin Cash or generate 195.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Cash vs. Galaxy Digital Holdings
Performance |
| Timeline |
| Grayscale Bitcoin Cash |
| Galaxy Digital Holdings |
Grayscale Bitcoin and Galaxy Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and Galaxy Digital
The main advantage of trading using opposite Grayscale Bitcoin and Galaxy Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, Galaxy Digital 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 Galaxy Digital will offset losses from the drop in Galaxy Digital's long position.| Grayscale Bitcoin vs. Morgan Stanley | Grayscale Bitcoin vs. Goldman Sachs Group | Grayscale Bitcoin vs. Charles Schwab Corp | Grayscale Bitcoin vs. Interactive Brokers Group |
| Galaxy Digital vs. DeFi Technologies | Galaxy Digital vs. Argo Blockchain PLC | Galaxy Digital vs. DigiMax Global | Galaxy Digital vs. BIG Blockchain Intelligence |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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