Correlation Between Grayscale Bitcoin and IShares Short
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and IShares Short 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 IShares Short 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 iShares Short Maturity, you can compare the effects of market volatilities on Grayscale Bitcoin and IShares Short 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 IShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and IShares Short.
Diversification Opportunities for Grayscale Bitcoin and IShares Short
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Grayscale and IShares is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Mini and iShares Short Maturity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Short Maturity 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 IShares Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Short Maturity has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and IShares Short go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and IShares Short
Considering the 90-day investment horizon Grayscale Bitcoin Mini is expected to under-perform the IShares Short. In addition to that, Grayscale Bitcoin is 40.76 times more volatile than iShares Short Maturity. It trades about -0.01 of its total potential returns per unit of risk. iShares Short Maturity is currently generating about 0.29 per unit of volatility. If you would invest 4,501 in iShares Short Maturity on September 3, 2024 and sell it today you would earn a total of 583.00 from holding iShares Short Maturity or generate 12.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Mini vs. iShares Short Maturity
Performance |
| Timeline |
| Grayscale Bitcoin Mini |
| iShares Short Maturity |
Grayscale Bitcoin and IShares Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and IShares Short
The main advantage of trading using opposite Grayscale Bitcoin and IShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, IShares Short 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 IShares Short will offset losses from the drop in IShares Short'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 |
| IShares Short vs. Invesco Ultra Short | IShares Short vs. iShares Ultra Short Term | IShares Short vs. PIMCO Enhanced Short | IShares Short vs. iShares Floating Rate |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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