Correlation Between BLZ and BOUNTY

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

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

Diversification Opportunities for BLZ and BOUNTY

0.1

Correlation Coefficient

BLZ  BOUNTY

Average diversification

The 3 months correlation between BLZ and BOUNTY is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding BLZ and BOUNTY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOUNTY and BLZ 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 BLZ are associated (or correlated) with BOUNTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOUNTY has no effect on the direction of BLZ i.e., BLZ and BOUNTY go up and down completely randomly.

Pair Corralation between BLZ and BOUNTY

Assuming the 90 days trading horizon BLZ is expected to generate 0.41 times more return on investment than BOUNTY. However, BLZ is 2.42 times less risky than BOUNTY. It trades about 0.04 of its potential returns per unit of risk. BOUNTY is currently generating about -0.08 per unit of risk. If you would invest  3.52  in BLZ on April 23, 2025 and sell it today you would earn a total of  0.19  from holding BLZ or generate 5.4% return on investment over 90 days.

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

BLZ  vs.  BOUNTY

BLZ

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in BLZ are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, BLZ may actually be approaching a critical reversion point that can send shares even higher in August 2025.

BOUNTY

Risk-Adjusted Performance

Very Weak

Over the last 90 days BOUNTY has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Crypto's basic indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for BOUNTY investors.

Pair Trading with BLZ and BOUNTY

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

The idea behind BLZ and BOUNTY 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.