Correlation Between ProShares Bitcoin and Invesco Galaxy
Can any of the company-specific risk be diversified away by investing in both ProShares Bitcoin and Invesco Galaxy 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 ProShares Bitcoin and Invesco Galaxy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Bitcoin Strategy and Invesco Galaxy Bitcoin, you can compare the effects of market volatilities on ProShares Bitcoin and Invesco Galaxy 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 ProShares Bitcoin with a short position of Invesco Galaxy. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Bitcoin and Invesco Galaxy.
Diversification Opportunities for ProShares Bitcoin and Invesco Galaxy
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ProShares and Invesco is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Bitcoin Strategy and Invesco Galaxy Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Galaxy Bitcoin and ProShares 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 ProShares Bitcoin Strategy are associated (or correlated) with Invesco Galaxy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Galaxy Bitcoin has no effect on the direction of ProShares Bitcoin i.e., ProShares Bitcoin and Invesco Galaxy go up and down completely randomly.
Pair Corralation between ProShares Bitcoin and Invesco Galaxy
Given the investment horizon of 90 days ProShares Bitcoin Strategy is expected to under-perform the Invesco Galaxy. In addition to that, ProShares Bitcoin is 1.02 times more volatile than Invesco Galaxy Bitcoin. It trades about -0.34 of its total potential returns per unit of risk. Invesco Galaxy Bitcoin is currently generating about -0.34 per unit of volatility. If you would invest 10,105 in Invesco Galaxy Bitcoin on November 29, 2024 and sell it today you would lose (1,692) from holding Invesco Galaxy Bitcoin or give up 16.74% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
ProShares Bitcoin Strategy vs. Invesco Galaxy Bitcoin
Performance |
Timeline |
ProShares Bitcoin |
Invesco Galaxy Bitcoin |
ProShares Bitcoin and Invesco Galaxy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ProShares Bitcoin and Invesco Galaxy
The main advantage of trading using opposite ProShares Bitcoin and Invesco Galaxy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Bitcoin position performs unexpectedly, Invesco Galaxy 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 Invesco Galaxy will offset losses from the drop in Invesco Galaxy's long position.ProShares Bitcoin vs. Grayscale Bitcoin Trust | ||
ProShares Bitcoin vs. Grayscale Ethereum Trust | ||
ProShares Bitcoin vs. Coinbase Global | ||
ProShares Bitcoin vs. Valkyrie Bitcoin Strategy |
Invesco Galaxy vs. Grayscale Funds Trust | ||
Invesco Galaxy vs. ProShares Trust | ||
Invesco Galaxy vs. iShares Ethereum Trust | ||
Invesco Galaxy vs. ProShares Trust |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |