Correlation Between 21Shares Bitwise and SPDR MSCI
Can any of the company-specific risk be diversified away by investing in both 21Shares Bitwise and SPDR MSCI 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 21Shares Bitwise and SPDR MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 21Shares Bitwise Select and SPDR MSCI EM, you can compare the effects of market volatilities on 21Shares Bitwise and SPDR MSCI 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 21Shares Bitwise with a short position of SPDR MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Bitwise and SPDR MSCI.
Diversification Opportunities for 21Shares Bitwise and SPDR MSCI
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 21Shares and SPDR is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Bitwise Select and SPDR MSCI EM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR MSCI EM and 21Shares Bitwise 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 21Shares Bitwise Select are associated (or correlated) with SPDR MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR MSCI EM has no effect on the direction of 21Shares Bitwise i.e., 21Shares Bitwise and SPDR MSCI go up and down completely randomly.
Pair Corralation between 21Shares Bitwise and SPDR MSCI
Assuming the 90 days trading horizon 21Shares Bitwise Select is expected to generate 3.82 times more return on investment than SPDR MSCI. However, 21Shares Bitwise is 3.82 times more volatile than SPDR MSCI EM. It trades about 0.15 of its potential returns per unit of risk. SPDR MSCI EM is currently generating about 0.06 per unit of risk. If you would invest 3,276 in 21Shares Bitwise Select on October 31, 2024 and sell it today you would earn a total of 298.00 from holding 21Shares Bitwise Select or generate 9.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
21Shares Bitwise Select vs. SPDR MSCI EM
Performance |
| Timeline |
| 21Shares Bitwise Select |
| SPDR MSCI EM |
21Shares Bitwise and SPDR MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 21Shares Bitwise and SPDR MSCI
The main advantage of trading using opposite 21Shares Bitwise and SPDR MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Bitwise position performs unexpectedly, SPDR MSCI 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 SPDR MSCI will offset losses from the drop in SPDR MSCI's long position.| 21Shares Bitwise vs. UBSFund Solutions MSCI | 21Shares Bitwise vs. Vanguard SP 500 | 21Shares Bitwise vs. iShares VII PLC | 21Shares Bitwise vs. iShares Core SP |
| SPDR MSCI vs. SPDR MSCI Europe | SPDR MSCI vs. SPDR SP Utilities | SPDR MSCI vs. SPDR MSCI Europe | SPDR MSCI vs. SPDR Bloomberg Global |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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