Correlation Between Purpose Bitcoin and CI Europe
Can any of the company-specific risk be diversified away by investing in both Purpose Bitcoin and CI Europe 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 Purpose Bitcoin and CI Europe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Purpose Bitcoin CAD and CI Europe Hedged, you can compare the effects of market volatilities on Purpose Bitcoin and CI Europe 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 Purpose Bitcoin with a short position of CI Europe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Purpose Bitcoin and CI Europe.
Diversification Opportunities for Purpose Bitcoin and CI Europe
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Purpose and EHE is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Purpose Bitcoin CAD and CI Europe Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Europe Hedged and Purpose 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 Purpose Bitcoin CAD are associated (or correlated) with CI Europe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Europe Hedged has no effect on the direction of Purpose Bitcoin i.e., Purpose Bitcoin and CI Europe go up and down completely randomly.
Pair Corralation between Purpose Bitcoin and CI Europe
Assuming the 90 days trading horizon Purpose Bitcoin CAD is expected to generate 5.55 times more return on investment than CI Europe. However, Purpose Bitcoin is 5.55 times more volatile than CI Europe Hedged. It trades about 0.37 of its potential returns per unit of risk. CI Europe Hedged is currently generating about -0.11 per unit of risk. If you would invest 1,305 in Purpose Bitcoin CAD on September 1, 2024 and sell it today you would earn a total of 512.00 from holding Purpose Bitcoin CAD or generate 39.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Purpose Bitcoin CAD vs. CI Europe Hedged
Performance |
| Timeline |
| Purpose Bitcoin CAD |
| CI Europe Hedged |
Purpose Bitcoin and CI Europe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Purpose Bitcoin and CI Europe
The main advantage of trading using opposite Purpose Bitcoin and CI Europe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Purpose Bitcoin position performs unexpectedly, CI Europe 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 CI Europe will offset losses from the drop in CI Europe's long position.| Purpose Bitcoin vs. 3iQ Bitcoin ETF | Purpose Bitcoin vs. 3iQ CoinShares Ether | Purpose Bitcoin vs. Forstrong Global Income | Purpose Bitcoin vs. BMO Aggregate Bond |
| CI Europe vs. NBI High Yield | CI Europe vs. NBI Unconstrained Fixed | CI Europe vs. Mackenzie Developed ex North | CI Europe vs. BMO Short Term Bond |
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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