Correlation Between Bitcoin SV and Quant

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

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

Diversification Opportunities for Bitcoin SV and Quant

0.72

Correlation Coefficient

Bitcoin SV  Quant

Poor diversification

The 3 months correlation between Bitcoin and Quant is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin SV and Quant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quant and Bitcoin SV 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 SV are associated (or correlated) with Quant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quant has no effect on the direction of Bitcoin SV i.e., Bitcoin SV and Quant go up and down completely randomly.

Pair Corralation between Bitcoin SV and Quant

Assuming the 90 days trading horizon Bitcoin SV is expected to generate 3.98 times less return on investment than Quant. In addition to that, Bitcoin SV is 1.53 times more volatile than Quant. It trades about 0.0 of its total potential returns per unit of risk. Quant is currently generating about 0.03 per unit of volatility. If you would invest  10,519  in Quant on January 21, 2024 and sell it today you would earn a total of  47.00  from holding Quant or generate 0.45% return on investment over 90 days.

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

Bitcoin SV  vs.  Quant

Bitcoin SV

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin SV are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Bitcoin SV is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Quant

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Quant are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Quant may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with Bitcoin SV and Quant

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

The idea behind Bitcoin SV and Quant 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.