Correlation Between Grayscale Bitcoin and Blackrock 2037

Can any of the company-specific risk be diversified away by investing in both Grayscale Bitcoin and Blackrock 2037 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 Grayscale Bitcoin and Blackrock 2037 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Grayscale Bitcoin Trust and Blackrock 2037 Municipal, you can compare the effects of market volatilities on Grayscale Bitcoin and Blackrock 2037 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 Grayscale Bitcoin with a short position of Blackrock 2037. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grayscale Bitcoin and Blackrock 2037.

Diversification Opportunities for Grayscale Bitcoin and Blackrock 2037

0.66

Correlation Coefficient

Grayscale Bitcoin  Blackrock 2037

Poor diversification

The 3 months correlation between Grayscale and Blackrock is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Grayscale Bitcoin Trust and Blackrock 2037 Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock 2037 Municipal and Grayscale 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 Grayscale Bitcoin Trust are associated (or correlated) with Blackrock 2037. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock 2037 Municipal has no effect on the direction of Grayscale Bitcoin i.e., Grayscale Bitcoin and Blackrock 2037 go up and down completely randomly.

Pair Corralation between Grayscale Bitcoin and Blackrock 2037

Given the investment horizon of 90 days Grayscale Bitcoin Trust is expected to generate 5.66 times more return on investment than Blackrock 2037. However, Grayscale Bitcoin is 5.66 times more volatile than Blackrock 2037 Municipal. It trades about 0.28 of its potential returns per unit of risk. Blackrock 2037 Municipal is currently generating about 0.05 per unit of risk. If you would invest  4,779  in Grayscale Bitcoin Trust on September 18, 2024 and sell it today you would earn a total of  3,623  from holding Grayscale Bitcoin Trust or generate 75.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Grayscale Bitcoin Trust  vs.  Blackrock 2037 Municipal

Grayscale Bitcoin Trust

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Grayscale Bitcoin Trust are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Grayscale Bitcoin exhibited solid returns over the last few months and may actually be approaching a breakup point.

Blackrock 2037 Municipal

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock 2037 Municipal are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy primary indicators, Blackrock 2037 is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Grayscale Bitcoin and Blackrock 2037

The main advantage of trading using opposite Grayscale Bitcoin and Blackrock 2037 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grayscale Bitcoin position performs unexpectedly, Blackrock 2037 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 Blackrock 2037 will offset losses from the drop in Blackrock 2037's long position.

The idea behind Grayscale Bitcoin Trust and Blackrock 2037 Municipal 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.