Correlation Between VanEck Bitcoin and Stone Ridge
Can any of the company-specific risk be diversified away by investing in both VanEck Bitcoin and Stone Ridge 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 Bitcoin and Stone Ridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Bitcoin Trust and Stone Ridge 2060, you can compare the effects of market volatilities on VanEck Bitcoin and Stone Ridge 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 Bitcoin with a short position of Stone Ridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Bitcoin and Stone Ridge.
Diversification Opportunities for VanEck Bitcoin and Stone Ridge
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between VanEck and Stone is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Bitcoin Trust and Stone Ridge 2060 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stone Ridge 2060 and VanEck 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 VanEck Bitcoin Trust are associated (or correlated) with Stone Ridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stone Ridge 2060 has no effect on the direction of VanEck Bitcoin i.e., VanEck Bitcoin and Stone Ridge go up and down completely randomly.
Pair Corralation between VanEck Bitcoin and Stone Ridge
Given the investment horizon of 90 days VanEck Bitcoin Trust is expected to generate 3.64 times more return on investment than Stone Ridge. However, VanEck Bitcoin is 3.64 times more volatile than Stone Ridge 2060. It trades about 0.08 of its potential returns per unit of risk. Stone Ridge 2060 is currently generating about 0.28 per unit of risk. If you would invest 10,633 in VanEck Bitcoin Trust on November 9, 2024 and sell it today you would earn a total of 339.00 from holding VanEck Bitcoin Trust or generate 3.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
VanEck Bitcoin Trust vs. Stone Ridge 2060
Performance |
| Timeline |
| VanEck Bitcoin Trust |
| Stone Ridge 2060 |
VanEck Bitcoin and Stone Ridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Bitcoin and Stone Ridge
The main advantage of trading using opposite VanEck Bitcoin and Stone Ridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Bitcoin position performs unexpectedly, Stone Ridge 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 Stone Ridge will offset losses from the drop in Stone Ridge's long position.| VanEck Bitcoin vs. ProShares Trust | VanEck Bitcoin vs. iShares Ethereum Trust | VanEck Bitcoin vs. ProShares Trust | VanEck Bitcoin vs. Grayscale Ethereum Trust |
| Stone Ridge vs. Global X Funds | Stone Ridge vs. US Treasury 12 | Stone Ridge vs. Tidal Trust II | Stone Ridge vs. Franklin Liberty Treasury |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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