Correlation Between Grayscale Bitcoin and PIMCO Intermediate
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and PIMCO Intermediate 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 PIMCO Intermediate 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 PIMCO Intermediate Municipal, you can compare the effects of market volatilities on Grayscale Bitcoin and PIMCO Intermediate 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 PIMCO Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and PIMCO Intermediate.
Diversification Opportunities for Grayscale Bitcoin and PIMCO Intermediate
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grayscale and PIMCO is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Mini and PIMCO Intermediate Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PIMCO Intermediate 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 PIMCO Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PIMCO Intermediate has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and PIMCO Intermediate go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and PIMCO Intermediate
Considering the 90-day investment horizon Grayscale Bitcoin Mini is expected to generate 12.5 times more return on investment than PIMCO Intermediate. However, Grayscale Bitcoin is 12.5 times more volatile than PIMCO Intermediate Municipal. It trades about 0.38 of its potential returns per unit of risk. PIMCO Intermediate Municipal is currently generating about 0.12 per unit of risk. If you would invest 3,085 in Grayscale Bitcoin Mini on August 28, 2024 and sell it today you would earn a total of 1,131 from holding Grayscale Bitcoin Mini or generate 36.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Mini vs. PIMCO Intermediate Municipal
Performance |
| Timeline |
| Grayscale Bitcoin Mini |
| PIMCO Intermediate |
Grayscale Bitcoin and PIMCO Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and PIMCO Intermediate
The main advantage of trading using opposite Grayscale Bitcoin and PIMCO Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, PIMCO Intermediate 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 PIMCO Intermediate will offset losses from the drop in PIMCO Intermediate'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 |
| PIMCO Intermediate vs. SSGA Active Trust | PIMCO Intermediate vs. SPDR MarketAxess Investment | PIMCO Intermediate vs. SSGA Active 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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