Correlation Between CoinShares Physical and CoinShares Physical
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By analyzing existing cross correlation between CoinShares Physical Bitcoin and CoinShares Physical Litecoin, you can compare the effects of market volatilities on CoinShares Physical and CoinShares Physical 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 CoinShares Physical with a short position of CoinShares Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of CoinShares Physical and CoinShares Physical.
Diversification Opportunities for CoinShares Physical and CoinShares Physical
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CoinShares and CoinShares is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding CoinShares Physical Bitcoin and CoinShares Physical Litecoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoinShares Physical and CoinShares Physical 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 CoinShares Physical Bitcoin are associated (or correlated) with CoinShares Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoinShares Physical has no effect on the direction of CoinShares Physical i.e., CoinShares Physical and CoinShares Physical go up and down completely randomly.
Pair Corralation between CoinShares Physical and CoinShares Physical
Assuming the 90 days trading horizon CoinShares Physical is expected to generate 1.74 times less return on investment than CoinShares Physical. But when comparing it to its historical volatility, CoinShares Physical Bitcoin is 2.06 times less risky than CoinShares Physical. It trades about 0.15 of its potential returns per unit of risk. CoinShares Physical Litecoin is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,926 in CoinShares Physical Litecoin on November 3, 2024 and sell it today you would earn a total of 285.00 from holding CoinShares Physical Litecoin or generate 14.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 90.48% |
| Values | Daily Returns |
CoinShares Physical Bitcoin vs. CoinShares Physical Litecoin
Performance |
| Timeline |
| CoinShares Physical |
| CoinShares Physical |
CoinShares Physical and CoinShares Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CoinShares Physical and CoinShares Physical
The main advantage of trading using opposite CoinShares Physical and CoinShares Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CoinShares Physical position performs unexpectedly, CoinShares Physical 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 CoinShares Physical will offset losses from the drop in CoinShares Physical's long position.The idea behind CoinShares Physical Bitcoin and CoinShares Physical Litecoin 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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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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