Correlation Between Kaspa and BTM

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

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

Diversification Opportunities for Kaspa and BTM

-0.77

Correlation Coefficient

Kaspa  BTM

Pay attention - limited upside

The 3 months correlation between Kaspa and BTM is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Kaspa and BTM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTM and Kaspa 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 Kaspa are associated (or correlated) with BTM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTM has no effect on the direction of Kaspa i.e., Kaspa and BTM go up and down completely randomly.

Pair Corralation between Kaspa and BTM

Assuming the 90 days trading horizon Kaspa is expected to generate 11.15 times less return on investment than BTM. But when comparing it to its historical volatility, Kaspa is 3.41 times less risky than BTM. It trades about 0.03 of its potential returns per unit of risk. BTM is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  0.32  in BTM on April 22, 2025 and sell it today you would earn a total of  0.15  from holding BTM or generate 48.29% return on investment over 90 days.

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

Kaspa  vs.  BTM

Kaspa

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kaspa are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Kaspa may actually be approaching a critical reversion point that can send shares even higher in August 2025.

BTM

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BTM are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady primary indicators, BTM exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kaspa and BTM

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

The idea behind Kaspa and BTM 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.