This module allows you to analyze existing cross correlation between Bitstamp Bitcoin USD and Bitfinex Bitcoin USD. You can compare the effects of market volatilities on Bitstamp Bitcoin and Bitfinex Bitcoin 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 Bitstamp Bitcoin with a short position of Bitfinex Bitcoin. See also your portfolio center
. Please also check ongoing floating volatility patterns of Bitstamp Bitcoin
and Bitfinex Bitcoin
Bitstamp Bitcoin USD vs Bitfinex Bitcoin USD
Assuming 30 trading days horizon, Bitstamp Bitcoin USD is expected to generate 1.05 times more return on investment than Bitfinex Bitcoin. However, Bitstamp Bitcoin is 1.05 times more volatile than Bitfinex Bitcoin USD. It trades about -0.11 of its potential returns per unit of risk. Bitfinex Bitcoin USD is currently generating about -0.14 per unit of risk. If you would invest 1,080,318 in Bitstamp Bitcoin USD on February 17, 2018 and sell it today you would lose (218,226) from holding Bitstamp Bitcoin USD or give up 20.2% of portfolio value over 30 days.
|Time Period||1 Month [change]|
No risk reduction
Overlapping area represents the amount of risk that can be diversified away by holding Bitstamp Bitcoin USD and Bitfinex Bitcoin USD in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Bitfinex Bitcoin USD and Bitstamp Bitcoin 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 Bitstamp Bitcoin USD are associated (or correlated) with Bitfinex Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitfinex Bitcoin USD has no effect on the direction of Bitstamp Bitcoin i.e. Bitstamp Bitcoin and Bitfinex Bitcoin go up and down completely randomly.
Over the last 30 days Bitstamp Bitcoin USD has generated negative risk-adjusted returns adding no value to investors with long positions.
Over the last 30 days Bitfinex Bitcoin USD has generated negative risk-adjusted returns adding no value to investors with long positions.