Correlation Between Binance Coin and Pointsbet Holdings
Can any of the company-specific risk be diversified away by investing in both Binance Coin and Pointsbet Holdings 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 Binance Coin and Pointsbet Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binance Coin and Pointsbet Holdings, you can compare the effects of market volatilities on Binance Coin and Pointsbet Holdings 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 Binance Coin with a short position of Pointsbet Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binance Coin and Pointsbet Holdings.
Diversification Opportunities for Binance Coin and Pointsbet Holdings
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Binance and Pointsbet is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Binance Coin and Pointsbet Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pointsbet Holdings and Binance Coin 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 Binance Coin are associated (or correlated) with Pointsbet Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pointsbet Holdings has no effect on the direction of Binance Coin i.e., Binance Coin and Pointsbet Holdings go up and down completely randomly.
Pair Corralation between Binance Coin and Pointsbet Holdings
Assuming the 90 days trading horizon Binance Coin is expected to generate 2.33 times less return on investment than Pointsbet Holdings. But when comparing it to its historical volatility, Binance Coin is 1.2 times less risky than Pointsbet Holdings. It trades about 0.11 of its potential returns per unit of risk. Pointsbet Holdings is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 49.00 in Pointsbet Holdings on November 2, 2024 and sell it today you would earn a total of 49.00 from holding Pointsbet Holdings or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.2% |
| Values | Daily Returns |
Binance Coin vs. Pointsbet Holdings
Performance |
| Timeline |
| Binance Coin |
| Pointsbet Holdings |
Binance Coin and Pointsbet Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binance Coin and Pointsbet Holdings
The main advantage of trading using opposite Binance Coin and Pointsbet Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binance Coin position performs unexpectedly, Pointsbet Holdings 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 Pointsbet Holdings will offset losses from the drop in Pointsbet Holdings' long position.| Binance Coin vs. Staked Ether | Binance Coin vs. Cronos | Binance Coin vs. Wrapped Bitcoin | Binance Coin vs. Monero |
| Pointsbet Holdings vs. Retail Food Group | Pointsbet Holdings vs. Globe Metals Mining | Pointsbet Holdings vs. Bank of Queensland | Pointsbet Holdings vs. Qbe Insurance Group |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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