Correlation Between Grayscale Bitcoin and Exxon
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and Exxon 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 Exxon 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 Exxon Mobil Corp, you can compare the effects of market volatilities on Grayscale Bitcoin and Exxon 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 Exxon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and Exxon.
Diversification Opportunities for Grayscale Bitcoin and Exxon
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Grayscale and Exxon is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Mini and Exxon Mobil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exxon Mobil Corp 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 Exxon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exxon Mobil Corp has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and Exxon go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and Exxon
Considering the 90-day investment horizon Grayscale Bitcoin Mini is expected to generate 2.72 times more return on investment than Exxon. However, Grayscale Bitcoin is 2.72 times more volatile than Exxon Mobil Corp. It trades about 0.27 of its potential returns per unit of risk. Exxon Mobil Corp is currently generating about 0.02 per unit of risk. If you would invest 2,585 in Grayscale Bitcoin Mini on September 12, 2024 and sell it today you would earn a total of 1,909 from holding Grayscale Bitcoin Mini or generate 73.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Mini vs. Exxon Mobil Corp
Performance |
| Timeline |
| Grayscale Bitcoin Mini |
| Exxon Mobil Corp |
Grayscale Bitcoin and Exxon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and Exxon
The main advantage of trading using opposite Grayscale Bitcoin and Exxon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, Exxon 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 Exxon will offset losses from the drop in Exxon'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 |
| Exxon vs. Aquagold International | Exxon vs. Thrivent High Yield | Exxon vs. Morningstar Unconstrained Allocation | Exxon vs. Via Renewables |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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