Correlation Between VanEck Ethereum and Bitwise Ethereum
Can any of the company-specific risk be diversified away by investing in both VanEck Ethereum and Bitwise Ethereum 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 VanEck Ethereum and Bitwise Ethereum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Ethereum ETF and Bitwise Ethereum ETF, you can compare the effects of market volatilities on VanEck Ethereum and Bitwise Ethereum 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 VanEck Ethereum with a short position of Bitwise Ethereum. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Ethereum and Bitwise Ethereum.
Diversification Opportunities for VanEck Ethereum and Bitwise Ethereum
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between VanEck and Bitwise is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Ethereum ETF and Bitwise Ethereum ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitwise Ethereum ETF and VanEck Ethereum 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 VanEck Ethereum ETF are associated (or correlated) with Bitwise Ethereum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitwise Ethereum ETF has no effect on the direction of VanEck Ethereum i.e., VanEck Ethereum and Bitwise Ethereum go up and down completely randomly.
Pair Corralation between VanEck Ethereum and Bitwise Ethereum
Given the investment horizon of 90 days VanEck Ethereum ETF is expected to generate 1.02 times more return on investment than Bitwise Ethereum. However, VanEck Ethereum is 1.02 times more volatile than Bitwise Ethereum ETF. It trades about 0.33 of its potential returns per unit of risk. Bitwise Ethereum ETF is currently generating about 0.33 per unit of risk. If you would invest 3,669 in VanEck Ethereum ETF on August 27, 2024 and sell it today you would earn a total of 1,471 from holding VanEck Ethereum ETF or generate 40.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Ethereum ETF vs. Bitwise Ethereum ETF
Performance |
| Timeline |
| VanEck Ethereum ETF |
| Bitwise Ethereum ETF |
VanEck Ethereum and Bitwise Ethereum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Ethereum and Bitwise Ethereum
The main advantage of trading using opposite VanEck Ethereum and Bitwise Ethereum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Ethereum position performs unexpectedly, Bitwise Ethereum 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 Bitwise Ethereum will offset losses from the drop in Bitwise Ethereum's long position.| VanEck Ethereum vs. Grayscale Bitcoin Trust | VanEck Ethereum vs. Grayscale Bitcoin Mini | VanEck Ethereum vs. First Trust SkyBridge |
| Bitwise Ethereum vs. Grayscale Bitcoin Trust | Bitwise Ethereum vs. Grayscale Bitcoin Mini | Bitwise Ethereum vs. First Trust SkyBridge |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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