Correlation Between Bitwise Funds and BondBloxx ETF
Can any of the company-specific risk be diversified away by investing in both Bitwise Funds and BondBloxx ETF 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 Bitwise Funds and BondBloxx ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitwise Funds Trust and BondBloxx ETF Trust, you can compare the effects of market volatilities on Bitwise Funds and BondBloxx ETF 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 Bitwise Funds with a short position of BondBloxx ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitwise Funds and BondBloxx ETF.
Diversification Opportunities for Bitwise Funds and BondBloxx ETF
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bitwise and BondBloxx is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Bitwise Funds Trust and BondBloxx ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BondBloxx ETF Trust and Bitwise Funds 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 Bitwise Funds Trust are associated (or correlated) with BondBloxx ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BondBloxx ETF Trust has no effect on the direction of Bitwise Funds i.e., Bitwise Funds and BondBloxx ETF go up and down completely randomly.
Pair Corralation between Bitwise Funds and BondBloxx ETF
Given the investment horizon of 90 days Bitwise Funds Trust is expected to generate 8.55 times more return on investment than BondBloxx ETF. However, Bitwise Funds is 8.55 times more volatile than BondBloxx ETF Trust. It trades about 0.09 of its potential returns per unit of risk. BondBloxx ETF Trust is currently generating about 0.09 per unit of risk. If you would invest 2,409 in Bitwise Funds Trust on August 27, 2024 and sell it today you would earn a total of 4,880 from holding Bitwise Funds Trust or generate 202.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 85.69% |
| Values | Daily Returns |
Bitwise Funds Trust vs. BondBloxx ETF Trust
Performance |
| Timeline |
| Bitwise Funds Trust |
| BondBloxx ETF Trust |
Bitwise Funds and BondBloxx ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bitwise Funds and BondBloxx ETF
The main advantage of trading using opposite Bitwise Funds and BondBloxx ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitwise Funds position performs unexpectedly, BondBloxx ETF 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 BondBloxx ETF will offset losses from the drop in BondBloxx ETF's long position.| Bitwise Funds vs. Bitwise Crypto Industry | Bitwise Funds vs. USCF Sustainable Battery | Bitwise Funds vs. Osprey Bitcoin Trust |
| BondBloxx ETF vs. First Trust Senior | BondBloxx ETF vs. First Trust Low | BondBloxx ETF vs. First Trust Enhanced | BondBloxx ETF vs. First Trust TCW |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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