Correlation Between Tidal Trust and STKD Bitcoin
Can any of the company-specific risk be diversified away by investing in both Tidal Trust and STKD 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 Tidal Trust and STKD Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tidal Trust II and STKD Bitcoin Gold, you can compare the effects of market volatilities on Tidal Trust and STKD 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 Tidal Trust with a short position of STKD Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal Trust and STKD Bitcoin.
Diversification Opportunities for Tidal Trust and STKD Bitcoin
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tidal and STKD is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Tidal Trust II and STKD Bitcoin Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STKD Bitcoin Gold and Tidal Trust 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 Tidal Trust II are associated (or correlated) with STKD Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STKD Bitcoin Gold has no effect on the direction of Tidal Trust i.e., Tidal Trust and STKD Bitcoin go up and down completely randomly.
Pair Corralation between Tidal Trust and STKD Bitcoin
Given the investment horizon of 90 days Tidal Trust is expected to generate 4.0 times less return on investment than STKD Bitcoin. But when comparing it to its historical volatility, Tidal Trust II is 2.54 times less risky than STKD Bitcoin. It trades about 0.13 of its potential returns per unit of risk. STKD Bitcoin Gold is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 2,661 in STKD Bitcoin Gold on September 18, 2024 and sell it today you would earn a total of 404.00 from holding STKD Bitcoin Gold or generate 15.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tidal Trust II vs. STKD Bitcoin Gold
Performance |
| Timeline |
| Tidal Trust II |
| STKD Bitcoin Gold |
Tidal Trust and STKD Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tidal Trust and STKD Bitcoin
The main advantage of trading using opposite Tidal Trust and STKD Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidal Trust position performs unexpectedly, STKD 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 STKD Bitcoin will offset losses from the drop in STKD Bitcoin's long position.| Tidal Trust vs. Freedom Day Dividend | Tidal Trust vs. Franklin Templeton ETF | Tidal Trust vs. iShares MSCI China | Tidal Trust vs. Tidal Trust II |
| STKD Bitcoin vs. Freedom Day Dividend | STKD Bitcoin vs. Franklin Templeton ETF | STKD Bitcoin vs. iShares MSCI China | STKD Bitcoin vs. Tidal Trust II |
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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