Correlation Between NYSE Composite and Grayscale Bitcoin
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Grayscale 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 NYSE Composite and Grayscale Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Grayscale Bitcoin Mini, you can compare the effects of market volatilities on NYSE Composite and Grayscale 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 NYSE Composite with a short position of Grayscale Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Grayscale Bitcoin.
Diversification Opportunities for NYSE Composite and Grayscale Bitcoin
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and Grayscale is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Grayscale Bitcoin Mini in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Bitcoin Mini and NYSE Composite 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 NYSE Composite are associated (or correlated) with Grayscale Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Bitcoin Mini has no effect on the direction of NYSE Composite i.e., NYSE Composite and Grayscale Bitcoin go up and down completely randomly.
Pair Corralation between NYSE Composite and Grayscale Bitcoin
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.17 times more return on investment than Grayscale Bitcoin. However, NYSE Composite is 5.98 times less risky than Grayscale Bitcoin. It trades about 0.11 of its potential returns per unit of risk. Grayscale Bitcoin Mini is currently generating about -0.01 per unit of risk. If you would invest 1,550,264 in NYSE Composite on August 31, 2024 and sell it today you would earn a total of 476,940 from holding NYSE Composite or generate 30.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Grayscale Bitcoin Mini
Performance |
| Timeline |
NYSE Composite and Grayscale Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Grayscale Bitcoin Mini
Pair trading matchups for Grayscale Bitcoin
Pair Trading with NYSE Composite and Grayscale Bitcoin
The main advantage of trading using opposite NYSE Composite and Grayscale Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Grayscale 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 Grayscale Bitcoin will offset losses from the drop in Grayscale Bitcoin's long position.| NYSE Composite vs. Nextplat Corp | NYSE Composite vs. Qualys Inc | NYSE Composite vs. Cadence Design Systems | NYSE Composite vs. Asure Software |
| Grayscale Bitcoin vs. ProShares Trust | Grayscale Bitcoin vs. iShares Ethereum Trust | Grayscale Bitcoin vs. ProShares Trust | Grayscale 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |