Correlation Between Grayscale Bitcoin and 21shares Core
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and 21shares Core 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 21shares Core 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 21shares Core Ethereum, you can compare the effects of market volatilities on Grayscale Bitcoin and 21shares Core 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 21shares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and 21shares Core.
Diversification Opportunities for Grayscale Bitcoin and 21shares Core
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Grayscale and 21shares is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Trust and 21shares Core Ethereum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21shares Core Ethereum 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 21shares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21shares Core Ethereum has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and 21shares Core go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and 21shares Core
Given the investment horizon of 90 days Grayscale Bitcoin Trust is expected to generate 0.69 times more return on investment than 21shares Core. However, Grayscale Bitcoin Trust is 1.45 times less risky than 21shares Core. It trades about 0.13 of its potential returns per unit of risk. 21shares Core Ethereum is currently generating about -0.11 per unit of risk. If you would invest 7,802 in Grayscale Bitcoin Trust on November 4, 2024 and sell it today you would earn a total of 516.00 from holding Grayscale Bitcoin Trust or generate 6.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Trust vs. 21shares Core Ethereum
Performance |
| Timeline |
| Grayscale Bitcoin Trust |
| 21shares Core Ethereum |
Grayscale Bitcoin and 21shares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and 21shares Core
The main advantage of trading using opposite Grayscale Bitcoin and 21shares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, 21shares Core 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 21shares Core will offset losses from the drop in 21shares Core's long position.| Grayscale Bitcoin vs. Grayscale Ethereum Trust | Grayscale Bitcoin vs. Riot Blockchain | Grayscale Bitcoin vs. MARA HOLDINGS INC | Grayscale Bitcoin vs. Coinbase Global |
| 21shares Core vs. ProShares Trust | 21shares Core vs. iShares Ethereum Trust | 21shares Core vs. ProShares Trust | 21shares Core vs. Grayscale Ethereum Trust |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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