Correlation Between Valkyrie Bitcoin and KraneShares Asia
Can any of the company-specific risk be diversified away by investing in both Valkyrie Bitcoin and KraneShares Asia 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 Valkyrie Bitcoin and KraneShares Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valkyrie Bitcoin Miners and KraneShares Asia Pacific, you can compare the effects of market volatilities on Valkyrie Bitcoin and KraneShares Asia 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 Valkyrie Bitcoin with a short position of KraneShares Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valkyrie Bitcoin and KraneShares Asia.
Diversification Opportunities for Valkyrie Bitcoin and KraneShares Asia
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Valkyrie and KraneShares is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Valkyrie Bitcoin Miners and KraneShares Asia Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares Asia Pacific and Valkyrie Bitcoin 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 Valkyrie Bitcoin Miners are associated (or correlated) with KraneShares Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares Asia Pacific has no effect on the direction of Valkyrie Bitcoin i.e., Valkyrie Bitcoin and KraneShares Asia go up and down completely randomly.
Pair Corralation between Valkyrie Bitcoin and KraneShares Asia
Given the investment horizon of 90 days Valkyrie Bitcoin Miners is expected to generate 21.64 times more return on investment than KraneShares Asia. However, Valkyrie Bitcoin is 21.64 times more volatile than KraneShares Asia Pacific. It trades about 0.05 of its potential returns per unit of risk. KraneShares Asia Pacific is currently generating about 0.19 per unit of risk. If you would invest 1,635 in Valkyrie Bitcoin Miners on September 12, 2024 and sell it today you would earn a total of 1,078 from holding Valkyrie Bitcoin Miners or generate 65.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valkyrie Bitcoin Miners vs. KraneShares Asia Pacific
Performance |
| Timeline |
| Valkyrie Bitcoin Miners |
| KraneShares Asia Pacific |
Valkyrie Bitcoin and KraneShares Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valkyrie Bitcoin and KraneShares Asia
The main advantage of trading using opposite Valkyrie Bitcoin and KraneShares Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valkyrie Bitcoin position performs unexpectedly, KraneShares Asia 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 KraneShares Asia will offset losses from the drop in KraneShares Asia's long position.| Valkyrie Bitcoin vs. VanEck Digital Transformation | Valkyrie Bitcoin vs. Bitwise Crypto Industry | Valkyrie Bitcoin vs. Valkyrie Bitcoin Strategy | Valkyrie Bitcoin vs. Stronghold Digital Mining |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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