Correlation Between Grayscale Bitcoin and Franklin Liberty
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and Franklin Liberty 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 Franklin Liberty 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 Franklin Liberty Investment, you can compare the effects of market volatilities on Grayscale Bitcoin and Franklin Liberty 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 Franklin Liberty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and Franklin Liberty.
Diversification Opportunities for Grayscale Bitcoin and Franklin Liberty
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grayscale and Franklin is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Mini and Franklin Liberty Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Liberty Inv 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 Franklin Liberty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Liberty Inv has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and Franklin Liberty go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and Franklin Liberty
Considering the 90-day investment horizon Grayscale Bitcoin Mini is expected to under-perform the Franklin Liberty. In addition to that, Grayscale Bitcoin is 7.88 times more volatile than Franklin Liberty Investment. It trades about -0.01 of its total potential returns per unit of risk. Franklin Liberty Investment is currently generating about 0.04 per unit of volatility. If you would invest 1,990 in Franklin Liberty Investment on August 28, 2024 and sell it today you would earn a total of 165.00 from holding Franklin Liberty Investment or generate 8.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Mini vs. Franklin Liberty Investment
Performance |
| Timeline |
| Grayscale Bitcoin Mini |
| Franklin Liberty Inv |
Grayscale Bitcoin and Franklin Liberty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and Franklin Liberty
The main advantage of trading using opposite Grayscale Bitcoin and Franklin Liberty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, Franklin Liberty 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 Franklin Liberty will offset losses from the drop in Franklin Liberty'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 |
| Franklin Liberty vs. Senstar Technologies | Franklin Liberty vs. ImmuCell | Franklin Liberty vs. Anika Therapeutics | Franklin Liberty vs. Aquagold International |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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