Correlation Between Grayscale Bitcoin and VanEck China
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and VanEck China 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 VanEck China 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 VanEck China Bond, you can compare the effects of market volatilities on Grayscale Bitcoin and VanEck China 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 VanEck China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and VanEck China.
Diversification Opportunities for Grayscale Bitcoin and VanEck China
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grayscale and VanEck is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Trust and VanEck China Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck China Bond 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 VanEck China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck China Bond has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and VanEck China go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and VanEck China
Given the investment horizon of 90 days Grayscale Bitcoin Trust is expected to generate 13.23 times more return on investment than VanEck China. However, Grayscale Bitcoin is 13.23 times more volatile than VanEck China Bond. It trades about 0.14 of its potential returns per unit of risk. VanEck China Bond is currently generating about 0.04 per unit of risk. If you would invest 803.00 in Grayscale Bitcoin Trust on August 30, 2024 and sell it today you would earn a total of 6,879 from holding Grayscale Bitcoin Trust or generate 856.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Trust vs. VanEck China Bond
Performance |
| Timeline |
| Grayscale Bitcoin Trust |
| VanEck China Bond |
Grayscale Bitcoin and VanEck China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and VanEck China
The main advantage of trading using opposite Grayscale Bitcoin and VanEck China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, VanEck China 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 VanEck China will offset losses from the drop in VanEck China'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 |
| VanEck China vs. SPDR Bloomberg Emerging | VanEck China vs. Vanguard Emerging Markets | VanEck China vs. SPDR Bloomberg Barclays | VanEck China vs. VanEck JP Morgan |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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