Correlation Between Grayscale Bitcoin and Chevron Corp
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and Chevron Corp 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 Grayscale Bitcoin and Chevron Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grayscale Bitcoin Mini and Chevron Corp, you can compare the effects of market volatilities on Grayscale Bitcoin and Chevron Corp 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 Grayscale Bitcoin with a short position of Chevron Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and Chevron Corp.
Diversification Opportunities for Grayscale Bitcoin and Chevron Corp
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Grayscale and Chevron is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Mini and Chevron Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chevron Corp and Grayscale 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 Grayscale Bitcoin Mini are associated (or correlated) with Chevron Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chevron Corp has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and Chevron Corp go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and Chevron Corp
Considering the 90-day investment horizon Grayscale Bitcoin Mini is expected to under-perform the Chevron Corp. In addition to that, Grayscale Bitcoin is 4.14 times more volatile than Chevron Corp. It trades about -0.02 of its total potential returns per unit of risk. Chevron Corp is currently generating about 0.06 per unit of volatility. If you would invest 13,835 in Chevron Corp on September 3, 2024 and sell it today you would earn a total of 2,386 from holding Chevron Corp or generate 17.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Mini vs. Chevron Corp
Performance |
| Timeline |
| Grayscale Bitcoin Mini |
| Chevron Corp |
Grayscale Bitcoin and Chevron Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and Chevron Corp
The main advantage of trading using opposite Grayscale Bitcoin and Chevron Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, Chevron Corp 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 Chevron Corp will offset losses from the drop in Chevron Corp's long position.| Grayscale Bitcoin vs. ProShares Trust | Grayscale Bitcoin vs. iShares Ethereum Trust | Grayscale Bitcoin vs. ProShares Trust | Grayscale Bitcoin vs. Grayscale Ethereum 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |