Correlation Between Bitcoin and NATIONAL HEALTHCARE
Can any of the company-specific risk be diversified away by investing in both Bitcoin and NATIONAL HEALTHCARE 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 Bitcoin and NATIONAL HEALTHCARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitcoin and NATIONAL HEALTHCARE, you can compare the effects of market volatilities on Bitcoin and NATIONAL HEALTHCARE 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 Bitcoin with a short position of NATIONAL HEALTHCARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin and NATIONAL HEALTHCARE.
Diversification Opportunities for Bitcoin and NATIONAL HEALTHCARE
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bitcoin and NATIONAL is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin and NATIONAL HEALTHCARE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NATIONAL HEALTHCARE and 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 Bitcoin are associated (or correlated) with NATIONAL HEALTHCARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NATIONAL HEALTHCARE has no effect on the direction of Bitcoin i.e., Bitcoin and NATIONAL HEALTHCARE go up and down completely randomly.
Pair Corralation between Bitcoin and NATIONAL HEALTHCARE
Assuming the 90 days trading horizon Bitcoin is expected to generate 4.66 times more return on investment than NATIONAL HEALTHCARE. However, Bitcoin is 4.66 times more volatile than NATIONAL HEALTHCARE. It trades about 0.09 of its potential returns per unit of risk. NATIONAL HEALTHCARE is currently generating about 0.07 per unit of risk. If you would invest 2,325,278 in Bitcoin on October 26, 2024 and sell it today you would earn a total of 8,135,722 from holding Bitcoin or generate 349.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 59.48% |
| Values | Daily Returns |
Bitcoin vs. NATIONAL HEALTHCARE
Performance |
| Timeline |
| Bitcoin |
| NATIONAL HEALTHCARE |
Bitcoin and NATIONAL HEALTHCARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bitcoin and NATIONAL HEALTHCARE
The main advantage of trading using opposite Bitcoin and NATIONAL HEALTHCARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitcoin position performs unexpectedly, NATIONAL HEALTHCARE 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 NATIONAL HEALTHCARE will offset losses from the drop in NATIONAL HEALTHCARE's long position.The idea behind Bitcoin and NATIONAL HEALTHCARE 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.| NATIONAL HEALTHCARE vs. Beta Systems Software | NATIONAL HEALTHCARE vs. ASURE SOFTWARE | NATIONAL HEALTHCARE vs. Sixt Leasing SE | NATIONAL HEALTHCARE vs. Easy Software AG |
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 Stocks Directory module to find actively traded stocks across global markets.
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