Correlation Between XTRA Bitcoin and VentureNet Capital

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

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

Diversification Opportunities for XTRA Bitcoin and VentureNet Capital

0.58

Correlation Coefficient

XTRA Bitcoin  VentureNet Capital

Very weak diversification

The 3 months correlation between XTRA and VentureNet is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding XTRA Bitcoin and VentureNet Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VentureNet Capital and XTRA 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 XTRA Bitcoin are associated (or correlated) with VentureNet Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VentureNet Capital has no effect on the direction of XTRA Bitcoin i.e., XTRA Bitcoin and VentureNet Capital go up and down completely randomly.

Pair Corralation between XTRA Bitcoin and VentureNet Capital

Given the investment horizon of 90 days XTRA Bitcoin is expected to generate 20.23 times less return on investment than VentureNet Capital. But when comparing it to its historical volatility, XTRA Bitcoin is 10.6 times less risky than VentureNet Capital. It trades about 0.06 of its potential returns per unit of risk. VentureNet Capital Group is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  0.02  in VentureNet Capital Group on October 22, 2024 and sell it today you would lose (0.01) from holding VentureNet Capital Group or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.31%
Values	Daily Returns

XTRA Bitcoin  vs.  VentureNet Capital Group

XTRA Bitcoin

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in XTRA Bitcoin are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting basic indicators, XTRA Bitcoin exhibited solid returns over the last few months and may actually be approaching a breakup point.

VentureNet Capital

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in VentureNet Capital Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, VentureNet Capital displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with XTRA Bitcoin and VentureNet Capital

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

The idea behind XTRA Bitcoin and VentureNet Capital Group 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.