Correlation Between Ethereum and BondBloxx ETF

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

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

Diversification Opportunities for Ethereum and BondBloxx ETF

-0.51

Correlation Coefficient

Ethereum  BondBloxx ETF

Excellent diversification

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

Pair Corralation between Ethereum and BondBloxx ETF

Assuming the 90 days trading horizon Ethereum is expected to under-perform the BondBloxx ETF. In addition to that, Ethereum is 17.56 times more volatile than BondBloxx ETF Trust. It trades about -0.2 of its total potential returns per unit of risk. BondBloxx ETF Trust is currently generating about 0.08 per unit of volatility. If you would invest  3,675  in BondBloxx ETF Trust on December 22, 2024 and sell it today you would earn a total of  42.00  from holding BondBloxx ETF Trust or generate 1.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	93.85%
Values	Daily Returns

Ethereum  vs.  BondBloxx ETF Trust

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.

BondBloxx ETF Trust

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BondBloxx ETF Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, BondBloxx ETF is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Ethereum and BondBloxx ETF

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

The idea behind Ethereum and BondBloxx ETF Trust 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.