Correlation Between Grayscale Bitcoin and BZDYF
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and BZDYF 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 Grayscale Bitcoin and BZDYF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grayscale Bitcoin Trust and BZDYF, you can compare the effects of market volatilities on Grayscale Bitcoin and BZDYF 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 Grayscale Bitcoin with a short position of BZDYF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and BZDYF.
Diversification Opportunities for Grayscale Bitcoin and BZDYF
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grayscale and BZDYF is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Trust and BZDYF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BZDYF and Grayscale Bitcoin 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 Grayscale Bitcoin Trust are associated (or correlated) with BZDYF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BZDYF has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and BZDYF go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and BZDYF
If you would invest 7,371 in Grayscale Bitcoin Trust on October 23, 2024 and sell it today you would earn a total of 978.00 from holding Grayscale Bitcoin Trust or generate 13.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Grayscale Bitcoin Trust vs. BZDYF
Performance |
| Timeline |
| Grayscale Bitcoin Trust |
| BZDYF |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Grayscale Bitcoin and BZDYF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and BZDYF
The main advantage of trading using opposite Grayscale Bitcoin and BZDYF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, BZDYF 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 BZDYF will offset losses from the drop in BZDYF's long position.| Grayscale Bitcoin vs. Grayscale Ethereum Trust | Grayscale Bitcoin vs. Riot Blockchain | Grayscale Bitcoin vs. Marathon Digital Holdings | Grayscale Bitcoin vs. Coinbase Global |
| BZDYF vs. FT Vest Equity | BZDYF vs. Zillow Group Class | BZDYF vs. Northern Lights | BZDYF vs. VanEck Vectors Moodys |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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