Correlation Between IShares Core and Grayscale Ethereum
Can any of the company-specific risk be diversified away by investing in both IShares Core and Grayscale Ethereum 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 IShares Core and Grayscale Ethereum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Core SP and Grayscale Ethereum Trust, you can compare the effects of market volatilities on IShares Core and Grayscale Ethereum 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 IShares Core with a short position of Grayscale Ethereum. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and Grayscale Ethereum.
Diversification Opportunities for IShares Core and Grayscale Ethereum
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and Grayscale is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and Grayscale Ethereum Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Ethereum Trust and IShares Core 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 iShares Core SP are associated (or correlated) with Grayscale Ethereum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Ethereum Trust has no effect on the direction of IShares Core i.e., IShares Core and Grayscale Ethereum go up and down completely randomly.
Pair Corralation between IShares Core and Grayscale Ethereum
Considering the 90-day investment horizon IShares Core is expected to generate 12.6 times less return on investment than Grayscale Ethereum. But when comparing it to its historical volatility, iShares Core SP is 6.03 times less risky than Grayscale Ethereum. It trades about 0.16 of its potential returns per unit of risk. Grayscale Ethereum Trust is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 2,109 in Grayscale Ethereum Trust on August 27, 2024 and sell it today you would earn a total of 835.00 from holding Grayscale Ethereum Trust or generate 39.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Core SP vs. Grayscale Ethereum Trust
Performance |
| Timeline |
| iShares Core SP |
| Grayscale Ethereum Trust |
IShares Core and Grayscale Ethereum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Core and Grayscale Ethereum
The main advantage of trading using opposite IShares Core and Grayscale Ethereum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, Grayscale Ethereum 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 Ethereum will offset losses from the drop in Grayscale Ethereum's long position.| IShares Core vs. iShares Core SP | IShares Core vs. iShares Core SP | IShares Core vs. iShares SP 500 | IShares Core vs. iShares Russell 2000 |
| Grayscale Ethereum vs. Grayscale Bitcoin Trust | Grayscale Ethereum vs. Grayscale Litecoin Trust | Grayscale Ethereum vs. Grayscale Digital Large | Grayscale Ethereum vs. Bitwise 10 Crypto |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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