Correlation Between Tema ETF and Valkyrie Bitcoin
Can any of the company-specific risk be diversified away by investing in both Tema ETF and Valkyrie Bitcoin 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 Tema ETF and Valkyrie Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tema ETF Trust and Valkyrie Bitcoin, you can compare the effects of market volatilities on Tema ETF and Valkyrie Bitcoin 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 Tema ETF with a short position of Valkyrie Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tema ETF and Valkyrie Bitcoin.
Diversification Opportunities for Tema ETF and Valkyrie Bitcoin
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tema and Valkyrie is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Tema ETF Trust and Valkyrie Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valkyrie Bitcoin and Tema ETF 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 Tema ETF Trust are associated (or correlated) with Valkyrie Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valkyrie Bitcoin has no effect on the direction of Tema ETF i.e., Tema ETF and Valkyrie Bitcoin go up and down completely randomly.
Pair Corralation between Tema ETF and Valkyrie Bitcoin
Considering the 90-day investment horizon Tema ETF Trust is expected to under-perform the Valkyrie Bitcoin. But the etf apears to be less risky and, when comparing its historical volatility, Tema ETF Trust is 3.51 times less risky than Valkyrie Bitcoin. The etf trades about -0.06 of its potential returns per unit of risk. The Valkyrie Bitcoin is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,917 in Valkyrie Bitcoin on August 29, 2024 and sell it today you would earn a total of 820.00 from holding Valkyrie Bitcoin or generate 42.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tema ETF Trust vs. Valkyrie Bitcoin
Performance |
| Timeline |
| Tema ETF Trust |
| Valkyrie Bitcoin |
Tema ETF and Valkyrie Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tema ETF and Valkyrie Bitcoin
The main advantage of trading using opposite Tema ETF and Valkyrie Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tema ETF position performs unexpectedly, Valkyrie Bitcoin 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 Valkyrie Bitcoin will offset losses from the drop in Valkyrie Bitcoin's long position.| Tema ETF vs. Smith Nephew SNATS | Tema ETF vs. Fresenius Medical Care | Tema ETF vs. Fomento Economico Mexicano | Tema ETF vs. The Cooper Companies, |
| Valkyrie Bitcoin vs. ProShares Trust | Valkyrie Bitcoin vs. iShares Ethereum Trust | Valkyrie Bitcoin vs. ProShares Trust | Valkyrie Bitcoin vs. Grayscale Ethereum Trust |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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