Correlation Between Bitcoin Well and Cathedra Bitcoin
Can any of the company-specific risk be diversified away by investing in both Bitcoin Well and Cathedra Bitcoin 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 Bitcoin Well and Cathedra Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitcoin Well and Cathedra Bitcoin, you can compare the effects of market volatilities on Bitcoin Well and Cathedra Bitcoin 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 Bitcoin Well with a short position of Cathedra Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin Well and Cathedra Bitcoin.
Diversification Opportunities for Bitcoin Well and Cathedra Bitcoin
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bitcoin and Cathedra is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin Well and Cathedra Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cathedra Bitcoin and Bitcoin Well 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 Bitcoin Well are associated (or correlated) with Cathedra Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cathedra Bitcoin has no effect on the direction of Bitcoin Well i.e., Bitcoin Well and Cathedra Bitcoin go up and down completely randomly.
Pair Corralation between Bitcoin Well and Cathedra Bitcoin
Assuming the 90 days trading horizon Bitcoin Well is expected to generate 1.27 times more return on investment than Cathedra Bitcoin. However, Bitcoin Well is 1.27 times more volatile than Cathedra Bitcoin. It trades about 0.23 of its potential returns per unit of risk. Cathedra Bitcoin is currently generating about -0.01 per unit of risk. If you would invest 14.00 in Bitcoin Well on August 31, 2024 and sell it today you would earn a total of 6.00 from holding Bitcoin Well or generate 42.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bitcoin Well vs. Cathedra Bitcoin
Performance |
| Timeline |
| Bitcoin Well |
| Cathedra Bitcoin |
Bitcoin Well and Cathedra Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bitcoin Well and Cathedra Bitcoin
The main advantage of trading using opposite Bitcoin Well and Cathedra Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitcoin Well position performs unexpectedly, Cathedra Bitcoin 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 Cathedra Bitcoin will offset losses from the drop in Cathedra Bitcoin's long position.The idea behind Bitcoin Well and Cathedra Bitcoin pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Cathedra Bitcoin vs. Bitfarms | Cathedra Bitcoin vs. Digihost Technology | Cathedra Bitcoin vs. Neptune Digital Assets | Cathedra Bitcoin vs. SATO Technologies Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Stocks Directory Find actively traded stocks across global markets |