Correlation Between Bitwise Crypto and Global X
Can any of the company-specific risk be diversified away by investing in both Bitwise Crypto and Global X 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 Crypto and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitwise Crypto Industry and Global X Blockchain, you can compare the effects of market volatilities on Bitwise Crypto and Global X 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 Crypto with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitwise Crypto and Global X.
Diversification Opportunities for Bitwise Crypto and Global X
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bitwise and Global is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Bitwise Crypto Industry and Global X Blockchain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Blockchain and Bitwise Crypto 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 Crypto Industry are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Blockchain has no effect on the direction of Bitwise Crypto i.e., Bitwise Crypto and Global X go up and down completely randomly.
Pair Corralation between Bitwise Crypto and Global X
Given the investment horizon of 90 days Bitwise Crypto Industry is expected to generate 0.92 times more return on investment than Global X. However, Bitwise Crypto Industry is 1.09 times less risky than Global X. It trades about 0.09 of its potential returns per unit of risk. Global X Blockchain is currently generating about 0.07 per unit of risk. If you would invest 1,634 in Bitwise Crypto Industry on October 26, 2024 and sell it today you would earn a total of 339.00 from holding Bitwise Crypto Industry or generate 20.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bitwise Crypto Industry vs. Global X Blockchain
Performance |
| Timeline |
| Bitwise Crypto Industry |
| Global X Blockchain |
Bitwise Crypto and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bitwise Crypto and Global X
The main advantage of trading using opposite Bitwise Crypto and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitwise Crypto position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| Bitwise Crypto vs. Bitwise 10 Crypto | Bitwise Crypto vs. VanEck Digital Transformation | Bitwise Crypto vs. Global X Blockchain | Bitwise Crypto vs. First Trust Indxx |
| Global X vs. VanEck Digital Transformation | Global X vs. Bitwise Crypto Industry | Global X vs. First Trust Indxx | Global X vs. First Trust SkyBridge |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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