Correlation Between Vanguard Total and Valkyrie Bitcoin
Can any of the company-specific risk be diversified away by investing in both Vanguard Total 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 Vanguard Total and Valkyrie Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Total Stock and Valkyrie Bitcoin Strategy, you can compare the effects of market volatilities on Vanguard Total 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 Vanguard Total with a short position of Valkyrie Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Total and Valkyrie Bitcoin.
Diversification Opportunities for Vanguard Total and Valkyrie Bitcoin
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Vanguard and Valkyrie is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Stock and Valkyrie Bitcoin Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valkyrie Bitcoin Strategy and Vanguard Total 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 Total Stock 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 Strategy has no effect on the direction of Vanguard Total i.e., Vanguard Total and Valkyrie Bitcoin go up and down completely randomly.
Pair Corralation between Vanguard Total and Valkyrie Bitcoin
Considering the 90-day investment horizon Vanguard Total is expected to generate 8.21 times less return on investment than Valkyrie Bitcoin. But when comparing it to its historical volatility, Vanguard Total Stock is 5.15 times less risky than Valkyrie Bitcoin. It trades about 0.2 of its potential returns per unit of risk. Valkyrie Bitcoin Strategy is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,759 in Valkyrie Bitcoin Strategy on August 30, 2024 and sell it today you would earn a total of 605.00 from holding Valkyrie Bitcoin Strategy or generate 34.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Total Stock vs. Valkyrie Bitcoin Strategy
Performance |
| Timeline |
| Vanguard Total Stock |
| Valkyrie Bitcoin Strategy |
Vanguard Total and Valkyrie Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Total and Valkyrie Bitcoin
The main advantage of trading using opposite Vanguard Total and Valkyrie Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Total 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.| Vanguard Total vs. Vanguard SP 500 | Vanguard Total vs. Vanguard Total International | Vanguard Total vs. Vanguard Real Estate | Vanguard Total vs. Vanguard Total Bond |
| Valkyrie Bitcoin vs. ProShares Bitcoin Strategy | Valkyrie Bitcoin vs. Bitwise Crypto Industry | Valkyrie Bitcoin vs. Bitwise 10 Crypto | Valkyrie Bitcoin 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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