Correlation Between EigenLayer and Bittensor

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

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

Diversification Opportunities for EigenLayer and Bittensor

-0.29

Correlation Coefficient

EigenLayer  Bittensor

Very good diversification

The 3 months correlation between EigenLayer and Bittensor is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding EigenLayer and Bittensor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bittensor and EigenLayer 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 EigenLayer are associated (or correlated) with Bittensor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bittensor has no effect on the direction of EigenLayer i.e., EigenLayer and Bittensor go up and down completely randomly.

Pair Corralation between EigenLayer and Bittensor

Assuming the 90 days trading horizon EigenLayer is expected to generate 1.59 times less return on investment than Bittensor. In addition to that, EigenLayer is 1.13 times more volatile than Bittensor. It trades about 0.02 of its total potential returns per unit of risk. Bittensor is currently generating about 0.04 per unit of volatility. If you would invest  37,289  in Bittensor on July 29, 2025 and sell it today you would earn a total of  2,346  from holding Bittensor or generate 6.29% return on investment over 90 days.

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

EigenLayer  vs.  Bittensor

EigenLayer

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in EigenLayer are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, EigenLayer exhibited solid returns over the last few months and may actually be approaching a breakup point.

Bittensor

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Bittensor are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Bittensor exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EigenLayer and Bittensor

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

The idea behind EigenLayer and Bittensor 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.