Correlation Between Alephim and BTC Standard

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Can any of the company-specific risk be diversified away by investing in both Alephim and BTC Standard 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 Alephim and BTC Standard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alephim and BTC Standard Hashrate, you can compare the effects of market volatilities on Alephim and BTC Standard 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 Alephim with a short position of BTC Standard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alephim and BTC Standard.

Diversification Opportunities for Alephim and BTC Standard

0.18
  Correlation Coefficient

Average diversification

The 3 months correlation between Alephim and BTCST is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Aleph.im and BTC Standard Hashrate Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTC Standard Hashrate and Alephim 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 Alephim are associated (or correlated) with BTC Standard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTC Standard Hashrate has no effect on the direction of Alephim i.e., Alephim and BTC Standard go up and down completely randomly.

Pair Corralation between Alephim and BTC Standard

Assuming the 90 days trading horizon Alephim is expected to generate 1.67 times more return on investment than BTC Standard. However, Alephim is 1.67 times more volatile than BTC Standard Hashrate. It trades about 0.06 of its potential returns per unit of risk. BTC Standard Hashrate is currently generating about 0.04 per unit of risk. If you would invest  51.00  in Alephim on April 8, 2022 and sell it today you would lose (25.00)  from holding Alephim or give up 49.02% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy36.26%
ValuesDaily Returns

Aleph.im  vs.  BTC Standard Hashrate Token

 Performance (%) 
      Timeline 
Alephim 
Alephim Performance
8 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Alephim are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Alephim sustained solid returns over the last few months and may actually be approaching a breakup point.

Alephim Price Channel

BTC Standard Hashrate 
BTCST Performance
0 of 100
Over the last 90 days BTC Standard Hashrate has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Crypto's basic indicators remain somewhat strong which may send shares a bit higher in August 2022. The current disturbance may also be a sign of long term up-swing for BTC Standard Hashrate investors.

BTCST Price Channel

Alephim and BTC Standard Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Alephim and BTC Standard

The main advantage of trading using opposite Alephim and BTC Standard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alephim position performs unexpectedly, BTC Standard 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 BTC Standard will offset losses from the drop in BTC Standard's long position.
The idea behind Alephim and BTC Standard Hashrate 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.

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