Correlation Between Jefferies Financial and Bit Digital
Can any of the company-specific risk be diversified away by investing in both Jefferies Financial and Bit Digital 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 Jefferies Financial and Bit Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jefferies Financial Group and Bit Digital, you can compare the effects of market volatilities on Jefferies Financial and Bit Digital 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 Jefferies Financial with a short position of Bit Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jefferies Financial and Bit Digital.
Diversification Opportunities for Jefferies Financial and Bit Digital
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jefferies and Bit is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Jefferies Financial Group and Bit Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bit Digital and Jefferies Financial 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 Jefferies Financial Group are associated (or correlated) with Bit Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bit Digital has no effect on the direction of Jefferies Financial i.e., Jefferies Financial and Bit Digital go up and down completely randomly.
Pair Corralation between Jefferies Financial and Bit Digital
Considering the 90-day investment horizon Jefferies Financial is expected to generate 2.71 times less return on investment than Bit Digital. But when comparing it to its historical volatility, Jefferies Financial Group is 3.75 times less risky than Bit Digital. It trades about 0.12 of its potential returns per unit of risk. Bit Digital is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 75.00 in Bit Digital on August 30, 2024 and sell it today you would earn a total of 368.00 from holding Bit Digital or generate 490.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Jefferies Financial Group vs. Bit Digital
Performance |
| Timeline |
| Jefferies Financial |
| Bit Digital |
Jefferies Financial and Bit Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jefferies Financial and Bit Digital
The main advantage of trading using opposite Jefferies Financial and Bit Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jefferies Financial position performs unexpectedly, Bit Digital 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 Bit Digital will offset losses from the drop in Bit Digital's long position.| Jefferies Financial vs. Lazard | Jefferies Financial vs. PJT Partners | Jefferies Financial vs. Moelis Co | Jefferies Financial vs. Houlihan Lokey |
| Bit Digital vs. Hut 8 Corp | Bit Digital vs. HIVE Blockchain Technologies | Bit Digital vs. CleanSpark | Bit Digital vs. Terawulf |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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