Correlation Between Grayscale Bitcoin and UBS ETRACS
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and UBS ETRACS 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 UBS ETRACS 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 UBS ETRACS , you can compare the effects of market volatilities on Grayscale Bitcoin and UBS ETRACS 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 UBS ETRACS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and UBS ETRACS.
Diversification Opportunities for Grayscale Bitcoin and UBS ETRACS
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grayscale and UBS is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Mini and UBS ETRACS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS ETRACS 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 UBS ETRACS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS ETRACS has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and UBS ETRACS go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and UBS ETRACS
Considering the 90-day investment horizon Grayscale Bitcoin Mini is expected to generate 1.11 times more return on investment than UBS ETRACS. However, Grayscale Bitcoin is 1.11 times more volatile than UBS ETRACS . It trades about -0.01 of its potential returns per unit of risk. UBS ETRACS is currently generating about -0.03 per unit of risk. If you would invest 8,916 in Grayscale Bitcoin Mini on September 1, 2024 and sell it today you would lose (4,607) from holding Grayscale Bitcoin Mini or give up 51.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Grayscale Bitcoin Mini vs. UBS ETRACS
Performance |
| Timeline |
| Grayscale Bitcoin Mini |
| UBS ETRACS |
Grayscale Bitcoin and UBS ETRACS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and UBS ETRACS
The main advantage of trading using opposite Grayscale Bitcoin and UBS ETRACS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, UBS ETRACS 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 UBS ETRACS will offset losses from the drop in UBS ETRACS'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 |
| UBS ETRACS vs. First Trust Exchange Traded | UBS ETRACS vs. Ultimus Managers Trust | UBS ETRACS vs. Horizon Kinetics Medical | UBS ETRACS vs. Harbor Health Care |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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