Correlation Between Bitcoin and DAI NIPPON

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

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

Diversification Opportunities for Bitcoin and DAI NIPPON

-0.74

Correlation Coefficient

Bitcoin  DAI NIPPON

Pay attention - limited upside

The 3 months correlation between Bitcoin and DAI is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin and DAI NIPPON PRINTING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAI NIPPON PRINTING and 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 Bitcoin are associated (or correlated) with DAI NIPPON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAI NIPPON PRINTING has no effect on the direction of Bitcoin i.e., Bitcoin and DAI NIPPON go up and down completely randomly.

Pair Corralation between Bitcoin and DAI NIPPON

Assuming the 90 days trading horizon Bitcoin is expected to generate 1.81 times more return on investment than DAI NIPPON. However, Bitcoin is 1.81 times more volatile than DAI NIPPON PRINTING. It trades about 0.09 of its potential returns per unit of risk. DAI NIPPON PRINTING is currently generating about 0.07 per unit of risk. If you would invest  9,860,693  in Bitcoin on October 23, 2024 and sell it today you would earn a total of  365,207  from holding Bitcoin or generate 3.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	85.0%
Values	Daily Returns

Bitcoin  vs.  DAI NIPPON PRINTING

Bitcoin

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Bitcoin exhibited solid returns over the last few months and may actually be approaching a breakup point.

DAI NIPPON PRINTING

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DAI NIPPON PRINTING has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Bitcoin and DAI NIPPON

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

The idea behind Bitcoin and DAI NIPPON PRINTING 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.