Correlation Between Ethereum Classic and BLZ
Can any of the company-specific risk be diversified away by investing in both Ethereum Classic and BLZ 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 Ethereum Classic and BLZ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ethereum Classic and BLZ, you can compare the effects of market volatilities on Ethereum Classic and BLZ 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 Ethereum Classic with a short position of BLZ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ethereum Classic and BLZ.
Diversification Opportunities for Ethereum Classic and BLZ
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ethereum and BLZ is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Ethereum Classic and BLZ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLZ and Ethereum Classic 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 Ethereum Classic are associated (or correlated) with BLZ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLZ has no effect on the direction of Ethereum Classic i.e., Ethereum Classic and BLZ go up and down completely randomly.
Pair Corralation between Ethereum Classic and BLZ
Assuming the 90 days trading horizon Ethereum Classic is expected to generate 0.79 times more return on investment than BLZ. However, Ethereum Classic is 1.27 times less risky than BLZ. It trades about 0.04 of its potential returns per unit of risk. BLZ is currently generating about -0.1 per unit of risk. If you would invest 2,579 in Ethereum Classic on November 1, 2024 and sell it today you would earn a total of 56.00 from holding Ethereum Classic or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ethereum Classic vs. BLZ
Performance |
| Timeline |
| Ethereum Classic |
| BLZ |
Ethereum Classic and BLZ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ethereum Classic and BLZ
The main advantage of trading using opposite Ethereum Classic and BLZ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ethereum Classic position performs unexpectedly, BLZ 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 BLZ will offset losses from the drop in BLZ's long position.| Ethereum Classic vs. Ethereum PoW | Ethereum Classic vs. Ethereum Name Service | Ethereum Classic vs. Staked Ether | Ethereum Classic vs. Phala Network |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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