Correlation Between Great West and Bitcoin Strategy

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

By analyzing existing cross correlation between Great West Goldman Sachs and Bitcoin Strategy Profund, you can compare the effects of market volatilities on Great West and Bitcoin Strategy 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 Great West with a short position of Bitcoin Strategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great West and Bitcoin Strategy.

Diversification Opportunities for Great West and Bitcoin Strategy

0.76

Correlation Coefficient

Great West  Bitcoin Strategy

Poor diversification

The 3 months correlation between Great and Bitcoin is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Great West Goldman Sachs and Bitcoin Strategy Profund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitcoin Strategy Profund and Great West 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 Great West Goldman Sachs are associated (or correlated) with Bitcoin Strategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitcoin Strategy Profund has no effect on the direction of Great West i.e., Great West and Bitcoin Strategy go up and down completely randomly.

Pair Corralation between Great West and Bitcoin Strategy

Assuming the 90 days horizon Great West Goldman Sachs is expected to under-perform the Bitcoin Strategy. But the mutual fund apears to be less risky and, when comparing its historical volatility, Great West Goldman Sachs is 3.8 times less risky than Bitcoin Strategy. The mutual fund trades about -0.27 of its potential returns per unit of risk. The Bitcoin Strategy Profund is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  3,383  in Bitcoin Strategy Profund on September 23, 2024 and sell it today you would lose (156.00) from holding Bitcoin Strategy Profund or give up 4.61% of portfolio value over 90 days.

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

Great West Goldman Sachs  vs.  Bitcoin Strategy Profund

Great West Goldman

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Great West Goldman Sachs has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward-looking indicators, Great West is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Bitcoin Strategy Profund

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin Strategy Profund are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Bitcoin Strategy showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Great West and Bitcoin Strategy

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

The idea behind Great West Goldman Sachs and Bitcoin Strategy Profund 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.