Correlation Between IShares Blockchain and Fidelity Crypto

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

By analyzing existing cross correlation between iShares Blockchain and and Fidelity Crypto Industry, you can compare the effects of market volatilities on IShares Blockchain and Fidelity Crypto 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 IShares Blockchain with a short position of Fidelity Crypto. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Blockchain and Fidelity Crypto.

Diversification Opportunities for IShares Blockchain and Fidelity Crypto

1.0

Correlation Coefficient

IShares Blockchain  Fidelity Crypto

No risk reduction

The 3 months correlation between IShares and Fidelity is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding iShares Blockchain and and Fidelity Crypto Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Crypto Industry and IShares Blockchain 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 iShares Blockchain and are associated (or correlated) with Fidelity Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Crypto Industry has no effect on the direction of IShares Blockchain i.e., IShares Blockchain and Fidelity Crypto go up and down completely randomly.

Pair Corralation between IShares Blockchain and Fidelity Crypto

Given the investment horizon of 90 days iShares Blockchain and is expected to under-perform the Fidelity Crypto. In addition to that, IShares Blockchain is 1.2 times more volatile than Fidelity Crypto Industry. It trades about -0.1 of its total potential returns per unit of risk. Fidelity Crypto Industry is currently generating about -0.11 per unit of volatility. If you would invest  3,409  in Fidelity Crypto Industry on December 27, 2024 and sell it today you would lose (750.00) from holding Fidelity Crypto Industry or give up 22.0% of portfolio value over 90 days.

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

iShares Blockchain and  vs.  Fidelity Crypto Industry

iShares Blockchain and

Risk-Adjusted Performance

Very Weak

Over the last 90 days iShares Blockchain and has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Etf's essential 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 the fund shareholders.

Fidelity Crypto Industry

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fidelity Crypto Industry has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Etf's forward indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the Exchange Traded Fund stockholders.

Pair Trading with IShares Blockchain and Fidelity Crypto

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

The idea behind iShares Blockchain and and Fidelity Crypto Industry 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.