Correlation Between Bitcoin and Kngt Clb

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

By analyzing existing cross correlation between Bitcoin and Kngt Clb Larg, you can compare the effects of market volatilities on Bitcoin and Kngt Clb 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 Kngt Clb. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin and Kngt Clb.

Diversification Opportunities for Bitcoin and Kngt Clb

0.74

Correlation Coefficient

Bitcoin  Kngt Clb

Poor diversification

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

Pair Corralation between Bitcoin and Kngt Clb

Assuming the 90 days trading horizon Bitcoin is expected to generate 3.43 times more return on investment than Kngt Clb. However, Bitcoin is 3.43 times more volatile than Kngt Clb Larg. It trades about 0.24 of its potential returns per unit of risk. Kngt Clb Larg is currently generating about 0.09 per unit of risk. If you would invest  6,657,777  in Bitcoin on October 24, 2024 and sell it today you would earn a total of  3,935,023  from holding Bitcoin or generate 59.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.24%
Values	Daily Returns

Bitcoin  vs.  Kngt Clb Larg

Bitcoin

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin are ranked lower than 18 (%) 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.

Kngt Clb Larg

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kngt Clb Larg are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Kngt Clb is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bitcoin and Kngt Clb

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

The idea behind Bitcoin and Kngt Clb Larg 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.