Correlation Between Main International and ARK 21Shares
Can any of the company-specific risk be diversified away by investing in both Main International and ARK 21Shares 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 Main International and ARK 21Shares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Main International ETF and ARK 21Shares Bitcoin, you can compare the effects of market volatilities on Main International and ARK 21Shares 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 Main International with a short position of ARK 21Shares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Main International and ARK 21Shares.
Diversification Opportunities for Main International and ARK 21Shares
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Main and ARK is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Main International ETF and ARK 21Shares Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ARK 21Shares Bitcoin and Main International 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 Main International ETF are associated (or correlated) with ARK 21Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ARK 21Shares Bitcoin has no effect on the direction of Main International i.e., Main International and ARK 21Shares go up and down completely randomly.
Pair Corralation between Main International and ARK 21Shares
Given the investment horizon of 90 days Main International ETF is expected to under-perform the ARK 21Shares. But the etf apears to be less risky and, when comparing its historical volatility, Main International ETF is 5.24 times less risky than ARK 21Shares. The etf trades about -0.11 of its potential returns per unit of risk. The ARK 21Shares Bitcoin is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 6,959 in ARK 21Shares Bitcoin on August 29, 2024 and sell it today you would earn a total of 2,703 from holding ARK 21Shares Bitcoin or generate 38.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Main International ETF vs. ARK 21Shares Bitcoin
Performance |
| Timeline |
| Main International ETF |
| ARK 21Shares Bitcoin |
Main International and ARK 21Shares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Main International and ARK 21Shares
The main advantage of trading using opposite Main International and ARK 21Shares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Main International position performs unexpectedly, ARK 21Shares 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 ARK 21Shares will offset losses from the drop in ARK 21Shares' long position.| Main International vs. ABIVAX Socit Anonyme | Main International vs. HUMANA INC | Main International vs. SCOR PK | Main International vs. Aquagold International |
| ARK 21Shares vs. Grayscale Bitcoin Trust | ARK 21Shares vs. ProShares Bitcoin Strategy | ARK 21Shares vs. Amplify Transformational Data | ARK 21Shares vs. Siren Nasdaq NexGen |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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