Correlation Between Vanguard Mid and Bitwise Crypto
Can any of the company-specific risk be diversified away by investing in both Vanguard Mid 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 Vanguard Mid and Bitwise Crypto into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Mid Cap Index and Bitwise Crypto Industry, you can compare the effects of market volatilities on Vanguard Mid 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 Vanguard Mid with a short position of Bitwise Crypto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Mid and Bitwise Crypto.
Diversification Opportunities for Vanguard Mid and Bitwise Crypto
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Vanguard and Bitwise is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Mid Cap Index 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 Vanguard Mid 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 Vanguard Mid Cap Index 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 Vanguard Mid i.e., Vanguard Mid and Bitwise Crypto go up and down completely randomly.
Pair Corralation between Vanguard Mid and Bitwise Crypto
Allowing for the 90-day total investment horizon Vanguard Mid is expected to generate 4.76 times less return on investment than Bitwise Crypto. But when comparing it to its historical volatility, Vanguard Mid Cap Index is 6.14 times less risky than Bitwise Crypto. It trades about 0.2 of its potential returns per unit of risk. Bitwise Crypto Industry is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,341 in Bitwise Crypto Industry on August 23, 2024 and sell it today you would earn a total of 629.00 from holding Bitwise Crypto Industry or generate 46.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Mid Cap Index vs. Bitwise Crypto Industry
Performance |
| Timeline |
| Vanguard Mid Cap |
| Bitwise Crypto Industry |
Vanguard Mid and Bitwise Crypto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Mid and Bitwise Crypto
The main advantage of trading using opposite Vanguard Mid and Bitwise Crypto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Mid 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.| Vanguard Mid vs. Vanguard Small Cap Index | Vanguard Mid vs. Vanguard Large Cap Index | Vanguard Mid vs. Vanguard Small Cap Growth | Vanguard Mid vs. Vanguard Small Cap Value |
| Bitwise Crypto vs. ProShares Bitcoin Strategy | Bitwise Crypto vs. Bitwise 10 Crypto | Bitwise Crypto vs. Global X Blockchain |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |