Correlation Between First Trust and Bitwise Crypto
Can any of the company-specific risk be diversified away by investing in both First Trust and Bitwise Crypto 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 First Trust and Bitwise Crypto into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Indxx and Bitwise Crypto Industry, you can compare the effects of market volatilities on First Trust and Bitwise Crypto 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 First Trust with a short position of Bitwise Crypto. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Bitwise Crypto.
Diversification Opportunities for First Trust and Bitwise Crypto
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between First and Bitwise is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Indxx and Bitwise Crypto Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitwise Crypto Industry and First Trust 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 First Trust Indxx are associated (or correlated) with Bitwise Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitwise Crypto Industry has no effect on the direction of First Trust i.e., First Trust and Bitwise Crypto go up and down completely randomly.
Pair Corralation between First Trust and Bitwise Crypto
Given the investment horizon of 90 days First Trust is expected to generate 1.01 times less return on investment than Bitwise Crypto. But when comparing it to its historical volatility, First Trust Indxx is 5.29 times less risky than Bitwise Crypto. It trades about 0.33 of its potential returns per unit of risk. Bitwise Crypto Industry is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,749 in Bitwise Crypto Industry on November 3, 2024 and sell it today you would earn a total of 66.00 from holding Bitwise Crypto Industry or generate 3.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Trust Indxx vs. Bitwise Crypto Industry
Performance |
| Timeline |
| First Trust Indxx |
| Bitwise Crypto Industry |
First Trust and Bitwise Crypto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Bitwise Crypto
The main advantage of trading using opposite First Trust and Bitwise Crypto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Bitwise Crypto 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 Bitwise Crypto will offset losses from the drop in Bitwise Crypto's long position.| First Trust vs. Siren Nasdaq NexGen | First Trust vs. Amplify Transformational Data | First Trust vs. Global X Blockchain | First Trust vs. VanEck Digital Transformation |
| Bitwise Crypto vs. Bitwise 10 Crypto | Bitwise Crypto vs. VanEck Digital Transformation | Bitwise Crypto vs. Global X Blockchain | Bitwise Crypto vs. First Trust Indxx |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |