Correlation Between Bitcoin and Blackrock Lifepath
Can any of the company-specific risk be diversified away by investing in both Bitcoin and Blackrock Lifepath 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 Blackrock Lifepath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitcoin and Blackrock Lifepath Dynamic, you can compare the effects of market volatilities on Bitcoin and Blackrock Lifepath 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 Blackrock Lifepath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin and Blackrock Lifepath.
Diversification Opportunities for Bitcoin and Blackrock Lifepath
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bitcoin and Blackrock is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin and Blackrock Lifepath Dynamic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Lifepath 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 Blackrock Lifepath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Lifepath has no effect on the direction of Bitcoin i.e., Bitcoin and Blackrock Lifepath go up and down completely randomly.
Pair Corralation between Bitcoin and Blackrock Lifepath
Assuming the 90 days trading horizon Bitcoin is expected to generate 3.59 times more return on investment than Blackrock Lifepath. However, Bitcoin is 3.59 times more volatile than Blackrock Lifepath Dynamic. It trades about 0.15 of its potential returns per unit of risk. Blackrock Lifepath Dynamic is currently generating about -0.09 per unit of risk. If you would invest 9,776,949 in Bitcoin on October 20, 2024 and sell it today you would earn a total of 658,751 from holding Bitcoin or generate 6.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Bitcoin vs. Blackrock Lifepath Dynamic
Performance |
| Timeline |
| Bitcoin |
| Blackrock Lifepath |
Bitcoin and Blackrock Lifepath Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bitcoin and Blackrock Lifepath
The main advantage of trading using opposite Bitcoin and Blackrock Lifepath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitcoin position performs unexpectedly, Blackrock Lifepath 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 Blackrock Lifepath will offset losses from the drop in Blackrock Lifepath's long position.The idea behind Bitcoin and Blackrock Lifepath Dynamic 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.| Blackrock Lifepath vs. T Rowe Price | Blackrock Lifepath vs. Doubleline Core Fixed | Blackrock Lifepath vs. Us Vector Equity | Blackrock Lifepath vs. Smallcap World Fund |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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