Correlation Between Ethereum and Bogle Small

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

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

Diversification Opportunities for Ethereum and Bogle Small

0.51

Correlation Coefficient

Ethereum  Bogle Small

Very weak diversification

The 3 months correlation between Ethereum and Bogle is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Ethereum and Bogle Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bogle Small Cap and Ethereum 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 Ethereum are associated (or correlated) with Bogle Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bogle Small Cap has no effect on the direction of Ethereum i.e., Ethereum and Bogle Small go up and down completely randomly.

Pair Corralation between Ethereum and Bogle Small

Assuming the 90 days trading horizon Ethereum is expected to under-perform the Bogle Small. In addition to that, Ethereum is 3.41 times more volatile than Bogle Small Cap. It trades about -0.18 of its total potential returns per unit of risk. Bogle Small Cap is currently generating about -0.1 per unit of volatility. If you would invest  3,098  in Bogle Small Cap on December 21, 2024 and sell it today you would lose (228.00) from holding Bogle Small Cap or give up 7.36% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	93.65%
Values	Daily Returns

Ethereum  vs.  Bogle Small Cap

Ethereum

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ethereum has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's technical indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Ethereum shareholders.

Bogle Small Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bogle Small Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Ethereum and Bogle Small

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

The idea behind Ethereum and Bogle Small Cap 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.