Correlation Between VanEck Global and 21Shares Bitwise
Can any of the company-specific risk be diversified away by investing in both VanEck Global and 21Shares Bitwise 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 Global and 21Shares Bitwise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Global Mining and 21Shares Bitwise Select, you can compare the effects of market volatilities on VanEck Global and 21Shares Bitwise 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 Global with a short position of 21Shares Bitwise. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Global and 21Shares Bitwise.
Diversification Opportunities for VanEck Global and 21Shares Bitwise
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between VanEck and 21Shares is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Global Mining and 21Shares Bitwise Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Bitwise Select and VanEck Global 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 Global Mining are associated (or correlated) with 21Shares Bitwise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Bitwise Select has no effect on the direction of VanEck Global i.e., VanEck Global and 21Shares Bitwise go up and down completely randomly.
Pair Corralation between VanEck Global and 21Shares Bitwise
Assuming the 90 days trading horizon VanEck Global Mining is expected to generate 0.4 times more return on investment than 21Shares Bitwise. However, VanEck Global Mining is 2.49 times less risky than 21Shares Bitwise. It trades about 0.24 of its potential returns per unit of risk. 21Shares Bitwise Select is currently generating about 0.01 per unit of risk. If you would invest 2,713 in VanEck Global Mining on November 9, 2024 and sell it today you would earn a total of 218.00 from holding VanEck Global Mining or generate 8.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Global Mining vs. 21Shares Bitwise Select
Performance |
| Timeline |
| VanEck Global Mining |
| 21Shares Bitwise Select |
VanEck Global and 21Shares Bitwise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Global and 21Shares Bitwise
The main advantage of trading using opposite VanEck Global and 21Shares Bitwise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Global position performs unexpectedly, 21Shares Bitwise 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 Bitwise will offset losses from the drop in 21Shares Bitwise's long position.| VanEck Global vs. VanEck Solana ETN | VanEck Global vs. VanEck Sustainable World | VanEck Global vs. VanEck iBoxx EUR | VanEck Global vs. VanEck Global Fallen |
| 21Shares Bitwise vs. 21Shares Polygon ETP | 21Shares Bitwise vs. 21Shares Ethereum Core | 21Shares Bitwise vs. 21Shares Tezos staking | 21Shares Bitwise vs. 21Shares Bitcoin ETP |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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