Correlation Between Grayscale Bitcoin and SPDR SSGA
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and SPDR SSGA 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 SPDR SSGA 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 SPDR SSGA Fixed, you can compare the effects of market volatilities on Grayscale Bitcoin and SPDR SSGA 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 SPDR SSGA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and SPDR SSGA.
Diversification Opportunities for Grayscale Bitcoin and SPDR SSGA
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Grayscale and SPDR is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Mini and SPDR SSGA Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SSGA Fixed 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 SPDR SSGA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SSGA Fixed has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and SPDR SSGA go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and SPDR SSGA
Considering the 90-day investment horizon Grayscale Bitcoin Mini is expected to generate 8.15 times more return on investment than SPDR SSGA. However, Grayscale Bitcoin is 8.15 times more volatile than SPDR SSGA Fixed. It trades about 0.1 of its potential returns per unit of risk. SPDR SSGA Fixed is currently generating about 0.03 per unit of risk. If you would invest 2,895 in Grayscale Bitcoin Mini on November 19, 2024 and sell it today you would earn a total of 1,416 from holding Grayscale Bitcoin Mini or generate 48.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 28.02% |
| Values | Daily Returns |
Grayscale Bitcoin Mini vs. SPDR SSGA Fixed
Performance |
| Timeline |
| Grayscale Bitcoin Mini |
| SPDR SSGA Fixed |
Grayscale Bitcoin and SPDR SSGA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and SPDR SSGA
The main advantage of trading using opposite Grayscale Bitcoin and SPDR SSGA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, SPDR SSGA 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 SPDR SSGA will offset losses from the drop in SPDR SSGA's long position.| Grayscale Bitcoin vs. Grayscale Funds Trust | Grayscale Bitcoin vs. ProShares Trust | Grayscale Bitcoin vs. iShares Ethereum Trust | Grayscale Bitcoin vs. ProShares Trust |
| SPDR SSGA vs. SPDR SSGA Sector | SPDR SSGA vs. SPDR DoubleLine Emerging | SPDR SSGA vs. SPDR DoubleLine Short | SPDR SSGA vs. SPDR SSgA Ultra |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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