Correlation Between Bitcoin Cash and ME
Can any of the company-specific risk be diversified away by investing in both Bitcoin Cash and ME 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 Bitcoin Cash and ME into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitcoin Cash and ME, you can compare the effects of market volatilities on Bitcoin Cash and ME 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 Bitcoin Cash with a short position of ME. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin Cash and ME.
Diversification Opportunities for Bitcoin Cash and ME
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bitcoin and ME is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin Cash and ME in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ME and Bitcoin Cash 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 Bitcoin Cash are associated (or correlated) with ME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ME has no effect on the direction of Bitcoin Cash i.e., Bitcoin Cash and ME go up and down completely randomly.
Pair Corralation between Bitcoin Cash and ME
Assuming the 90 days trading horizon Bitcoin Cash is expected to generate 2.49 times more return on investment than ME. However, Bitcoin Cash is 2.49 times more volatile than ME. It trades about -0.01 of its potential returns per unit of risk. ME is currently generating about -0.11 per unit of risk. If you would invest 53,880 in Bitcoin Cash on January 26, 2024 and sell it today you would lose (3,392) from holding Bitcoin Cash or give up 6.3% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Bitcoin Cash vs. ME
Performance |
Timeline |
Bitcoin Cash |
ME |
Bitcoin Cash and ME Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bitcoin Cash and ME
The main advantage of trading using opposite Bitcoin Cash and ME positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitcoin Cash position performs unexpectedly, ME 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 ME will offset losses from the drop in ME's long position.Bitcoin Cash vs. Bitcoin | Bitcoin Cash vs. Dogecoin | Bitcoin Cash vs. Litecoin | Bitcoin Cash vs. Ethereum Classic |
Check out your portfolio center.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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
Transaction History View history of all your transactions and understand their impact on performance |