Correlation Between Grayscale Bitcoin and Grayscale Future
Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and Grayscale Future 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 Grayscale Future 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 Grayscale Future of, you can compare the effects of market volatilities on Grayscale Bitcoin and Grayscale Future 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 Grayscale Future. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and Grayscale Future.
Diversification Opportunities for Grayscale Bitcoin and Grayscale Future
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Grayscale and Grayscale is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Trust and Grayscale Future of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Future 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 Grayscale Future. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Future has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and Grayscale Future go up and down completely randomly.
Pair Corralation between Grayscale Bitcoin and Grayscale Future
Given the investment horizon of 90 days Grayscale Bitcoin Trust is expected to generate 0.98 times more return on investment than Grayscale Future. However, Grayscale Bitcoin Trust is 1.02 times less risky than Grayscale Future. It trades about 0.13 of its potential returns per unit of risk. Grayscale Future of is currently generating about 0.06 per unit of risk. If you would invest 1,959 in Grayscale Bitcoin Trust on September 12, 2024 and sell it today you would earn a total of 5,697 from holding Grayscale Bitcoin Trust or generate 290.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grayscale Bitcoin Trust vs. Grayscale Future of
Performance |
| Timeline |
| Grayscale Bitcoin Trust |
| Grayscale Future |
Grayscale Bitcoin and Grayscale Future Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grayscale Bitcoin and Grayscale Future
The main advantage of trading using opposite Grayscale Bitcoin and Grayscale Future positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, Grayscale Future 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 Grayscale Future will offset losses from the drop in Grayscale Future'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 |
| Grayscale Future vs. Grayscale Digital Large | Grayscale Future vs. Valkyrie Bitcoin Miners | Grayscale Future vs. Bitwise Crypto Industry | Grayscale Future vs. VanEck Digital Transformation |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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