Correlation Between Schwab Target and Bitwise Funds

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

By analyzing existing cross correlation between Schwab Target 2010 and Bitwise Funds Trust, you can compare the effects of market volatilities on Schwab Target and Bitwise Funds 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 Schwab Target with a short position of Bitwise Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schwab Target and Bitwise Funds.

Diversification Opportunities for Schwab Target and Bitwise Funds

-0.42

Correlation Coefficient

Schwab Target  Bitwise Funds

Very good diversification

The 3 months correlation between Schwab and Bitwise is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Schwab Target 2010 and Bitwise Funds Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitwise Funds Trust and Schwab Target 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 Schwab Target 2010 are associated (or correlated) with Bitwise Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitwise Funds Trust has no effect on the direction of Schwab Target i.e., Schwab Target and Bitwise Funds go up and down completely randomly.

Pair Corralation between Schwab Target and Bitwise Funds

Assuming the 90 days horizon Schwab Target 2010 is expected to generate 0.08 times more return on investment than Bitwise Funds. However, Schwab Target 2010 is 12.78 times less risky than Bitwise Funds. It trades about 0.09 of its potential returns per unit of risk. Bitwise Funds Trust is currently generating about -0.26 per unit of risk. If you would invest  1,323  in Schwab Target 2010 on August 24, 2025 and sell it today you would earn a total of  20.00  from holding Schwab Target 2010 or generate 1.51% return on investment over 90 days.

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

Schwab Target 2010  vs.  Bitwise Funds Trust

Schwab Target 2010

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Schwab Target 2010 are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Schwab Target is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Bitwise Funds Trust

Risk-Adjusted Performance

Weakest

Over the last 90 days Bitwise Funds Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in December 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

Pair Trading with Schwab Target and Bitwise Funds

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

The idea behind Schwab Target 2010 and Bitwise Funds Trust 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.