Correlation Between BTC Digital and Bloomin Brands
Can any of the company-specific risk be diversified away by investing in both BTC Digital and Bloomin Brands 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 BTC Digital and Bloomin Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BTC Digital and Bloomin Brands, you can compare the effects of market volatilities on BTC Digital and Bloomin Brands 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 BTC Digital with a short position of Bloomin Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTC Digital and Bloomin Brands.
Diversification Opportunities for BTC Digital and Bloomin Brands
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BTC and Bloomin is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding BTC Digital and Bloomin Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bloomin Brands and BTC Digital 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 BTC Digital are associated (or correlated) with Bloomin Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bloomin Brands has no effect on the direction of BTC Digital i.e., BTC Digital and Bloomin Brands go up and down completely randomly.
Pair Corralation between BTC Digital and Bloomin Brands
Assuming the 90 days horizon BTC Digital is expected to generate 13.37 times more return on investment than Bloomin Brands. However, BTC Digital is 13.37 times more volatile than Bloomin Brands. It trades about 0.29 of its potential returns per unit of risk. Bloomin Brands is currently generating about -0.23 per unit of risk. If you would invest 1.88 in BTC Digital on August 24, 2024 and sell it today you would earn a total of 6.12 from holding BTC Digital or generate 325.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
BTC Digital vs. Bloomin Brands
Performance |
| Timeline |
| BTC Digital |
| Bloomin Brands |
BTC Digital and Bloomin Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTC Digital and Bloomin Brands
The main advantage of trading using opposite BTC Digital and Bloomin Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTC Digital position performs unexpectedly, Bloomin Brands 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 Bloomin Brands will offset losses from the drop in Bloomin Brands' long position.| BTC Digital vs. Gaotu Techedu DRC | BTC Digital vs. TAL Education Group | BTC Digital vs. Strategic Education | BTC Digital vs. Vasta Platform |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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