Correlation Between Valkyrie Bitcoin and IShares Core

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

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

Diversification Opportunities for Valkyrie Bitcoin and IShares Core

-0.7

Correlation Coefficient

Valkyrie Bitcoin  IShares Core

Excellent diversification

The 3 months correlation between Valkyrie and IShares is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Valkyrie Bitcoin Miners and iShares Core Aggregate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core Aggregate and Valkyrie 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 Valkyrie Bitcoin Miners are associated (or correlated) with IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core Aggregate has no effect on the direction of Valkyrie Bitcoin i.e., Valkyrie Bitcoin and IShares Core go up and down completely randomly.

Pair Corralation between Valkyrie Bitcoin and IShares Core

Given the investment horizon of 90 days Valkyrie Bitcoin Miners is expected to under-perform the IShares Core. In addition to that, Valkyrie Bitcoin is 17.75 times more volatile than iShares Core Aggregate. It trades about -0.13 of its total potential returns per unit of risk. iShares Core Aggregate is currently generating about 0.13 per unit of volatility. If you would invest  9,640  in iShares Core Aggregate on December 30, 2024 and sell it today you would earn a total of  233.00  from holding iShares Core Aggregate or generate 2.42% return on investment over 90 days.

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

Valkyrie Bitcoin Miners  vs.  iShares Core Aggregate

Valkyrie Bitcoin Miners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Valkyrie Bitcoin Miners has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Etf's primary indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the Etf traders.

iShares Core Aggregate

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Core Aggregate are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, IShares Core is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Valkyrie Bitcoin and IShares Core

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

The idea behind Valkyrie Bitcoin Miners and iShares Core Aggregate 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.