Correlation Between Ninepoint Bitcoin and 3iQ Bitcoin

Can any of the company-specific risk be diversified away by investing in both Ninepoint Bitcoin and 3iQ 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 Ninepoint Bitcoin and 3iQ Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ninepoint Bitcoin ETF and 3iQ Bitcoin ETF, you can compare the effects of market volatilities on Ninepoint Bitcoin and 3iQ 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 Ninepoint Bitcoin with a short position of 3iQ Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ninepoint Bitcoin and 3iQ Bitcoin.

Diversification Opportunities for Ninepoint Bitcoin and 3iQ Bitcoin

0.65

Correlation Coefficient

Ninepoint Bitcoin  3iQ Bitcoin

Poor diversification

The 3 months correlation between Ninepoint and 3iQ is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Ninepoint Bitcoin ETF and 3iQ Bitcoin ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 3iQ Bitcoin ETF and Ninepoint 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 Ninepoint Bitcoin ETF are associated (or correlated) with 3iQ Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 3iQ Bitcoin ETF has no effect on the direction of Ninepoint Bitcoin i.e., Ninepoint Bitcoin and 3iQ Bitcoin go up and down completely randomly.

Pair Corralation between Ninepoint Bitcoin and 3iQ Bitcoin

Assuming the 90 days trading horizon Ninepoint Bitcoin ETF is expected to under-perform the 3iQ Bitcoin. In addition to that, Ninepoint Bitcoin is 2.72 times more volatile than 3iQ Bitcoin ETF. It trades about -0.26 of its total potential returns per unit of risk. 3iQ Bitcoin ETF is currently generating about -0.33 per unit of volatility. If you would invest  2,333  in 3iQ Bitcoin ETF on December 4, 2024 and sell it today you would lose (360.00) from holding 3iQ Bitcoin ETF or give up 15.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Ninepoint Bitcoin ETF  vs.  3iQ Bitcoin ETF

Ninepoint Bitcoin ETF

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ninepoint Bitcoin ETF has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the ETF investors.

3iQ Bitcoin ETF

Risk-Adjusted Performance

Very Weak

Over the last 90 days 3iQ Bitcoin ETF has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Etf's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

Pair Trading with Ninepoint Bitcoin and 3iQ Bitcoin

The main advantage of trading using opposite Ninepoint Bitcoin and 3iQ Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ninepoint Bitcoin position performs unexpectedly, 3iQ 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 3iQ Bitcoin will offset losses from the drop in 3iQ Bitcoin's long position.

The idea behind Ninepoint Bitcoin ETF and 3iQ Bitcoin ETF pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..