Correlation Between Bitcoin and LAZY Old

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

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

Diversification Opportunities for Bitcoin and LAZY Old

-0.27

Correlation Coefficient

Bitcoin  LAZY Old

Very good diversification

The 3 months correlation between Bitcoin and LAZY is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin and LAZY Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LAZY Old 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 LAZY Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LAZY Old has no effect on the direction of Bitcoin i.e., Bitcoin and LAZY Old go up and down completely randomly.

Pair Corralation between Bitcoin and LAZY Old

If you would invest  6,928,895  in Bitcoin on October 12, 2024 and sell it today you would earn a total of  2,331,804  from holding Bitcoin or generate 33.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.6%
Values	Daily Returns

Bitcoin  vs.  LAZY Old

Bitcoin

Risk-Adjusted Performance

13 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin are ranked lower than 13 (%) 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.

LAZY Old

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LAZY Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, LAZY Old 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 LAZY Old

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

The idea behind Bitcoin and LAZY Old 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.