Correlation Between Bitcoin Cash and Maker

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Bitcoin Cash and Maker 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 Maker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitcoin Cash and Maker, you can compare the effects of market volatilities on Bitcoin Cash and Maker 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 Maker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin Cash and Maker.

Diversification Opportunities for Bitcoin Cash and Maker

0.8
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Bitcoin and Maker is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin Cash and Maker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maker 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 Maker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maker has no effect on the direction of Bitcoin Cash i.e., Bitcoin Cash and Maker go up and down completely randomly.

Pair Corralation between Bitcoin Cash and Maker

Assuming the 90 days trading horizon Bitcoin Cash is expected to generate 1.08 times more return on investment than Maker. However, Bitcoin Cash is 1.08 times more volatile than Maker. It trades about 0.04 of its potential returns per unit of risk. Maker is currently generating about 0.04 per unit of risk. If you would invest  32,603  in Bitcoin Cash on December 29, 2023 and sell it today you would earn a total of  21,740  from holding Bitcoin Cash or generate 66.68% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Bitcoin Cash  vs.  Maker

 Performance 
       Timeline  
Bitcoin Cash 

Risk-Adjusted Performance

12 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin Cash are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical indicators, Bitcoin Cash exhibited solid returns over the last few months and may actually be approaching a breakup point.
Maker 

Risk-Adjusted Performance

20 of 100

 
Low
 
High
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Maker are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Maker exhibited solid returns over the last few months and may actually be approaching a breakup point.

Bitcoin Cash and Maker Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bitcoin Cash and Maker

The main advantage of trading using opposite Bitcoin Cash and Maker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitcoin Cash position performs unexpectedly, Maker 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 Maker will offset losses from the drop in Maker's long position.
The idea behind Bitcoin Cash and Maker 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.
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.

Other Complementary Tools

Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Sectors
List of equity sectors categorizing publicly traded companies based on their primary business activities
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Portfolio Dashboard
Portfolio dashboard that provides centralized access to all your investments
AI Investment Finder
Use AI to screen and filter profitable investment opportunities
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges