Correlation Between Grayscale Bitcoin and Ramaco Resources
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and Ramaco Resources 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 Ramaco Resources 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 Ramaco Resources, you can compare the effects of market volatilities on Grayscale Bitcoin and Ramaco Resources 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 Ramaco Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and Ramaco Resources.
Diversification Opportunities for Grayscale Bitcoin and Ramaco Resources
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Grayscale and Ramaco is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Cash and Ramaco Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramaco Resources 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 Ramaco Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramaco Resources has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and Ramaco Resources go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and Ramaco Resources
Given the investment horizon of 90 days Grayscale Bitcoin is expected to generate 2.41 times less return on investment than Ramaco Resources. In addition to that, Grayscale Bitcoin is 1.9 times more volatile than Ramaco Resources. It trades about 0.05 of its total potential returns per unit of risk. Ramaco Resources is currently generating about 0.25 per unit of volatility. If you would invest 1,016 in Ramaco Resources on September 5, 2024 and sell it today you would earn a total of 250.00 from holding Ramaco Resources or generate 24.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Grayscale Bitcoin Cash vs. Ramaco Resources
Performance |
| Timeline |
| Grayscale Bitcoin Cash |
| Ramaco Resources |
Grayscale Bitcoin and Ramaco Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and Ramaco Resources
The main advantage of trading using opposite Grayscale Bitcoin and Ramaco Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, Ramaco Resources 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 Ramaco Resources will offset losses from the drop in Ramaco Resources' long position.| Grayscale Bitcoin vs. Grayscale Litecoin Trust | Grayscale Bitcoin vs. Grayscale Digital Large | Grayscale Bitcoin vs. Bitwise 10 Crypto | Grayscale Bitcoin vs. Grayscale Ethereum Trust |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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