Correlation Between Bitcoin and Nykredit Invest

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

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

Diversification Opportunities for Bitcoin and Nykredit Invest

0.74

Correlation Coefficient

Bitcoin  Nykredit Invest

Poor diversification

The 3 months correlation between Bitcoin and Nykredit is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin and Nykredit Invest Lange in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nykredit Invest Lange and 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 Bitcoin are associated (or correlated) with Nykredit Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nykredit Invest Lange has no effect on the direction of Bitcoin i.e., Bitcoin and Nykredit Invest go up and down completely randomly.

Pair Corralation between Bitcoin and Nykredit Invest

Assuming the 90 days trading horizon Bitcoin is expected to under-perform the Nykredit Invest. In addition to that, Bitcoin is 10.81 times more volatile than Nykredit Invest Lange. It trades about -0.06 of its total potential returns per unit of risk. Nykredit Invest Lange is currently generating about -0.17 per unit of volatility. If you would invest  8,078  in Nykredit Invest Lange on January 26, 2024 and sell it today you would lose (68.00) from holding Nykredit Invest Lange or give up 0.84% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	86.36%
Values	Daily Returns

Bitcoin  vs.  Nykredit Invest Lange

Bitcoin

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Bitcoin exhibited solid returns over the last few months and may actually be approaching a breakup point.

Nykredit Invest Lange

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Nykredit Invest Lange are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Nykredit Invest is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Bitcoin and Nykredit Invest

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

The idea behind Bitcoin and Nykredit Invest Lange 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.