Correlation Between Blockmate Ventures and Cathedra Bitcoin

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

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

Diversification Opportunities for Blockmate Ventures and Cathedra Bitcoin

-0.5

Correlation Coefficient

Blockmate Ventures  Cathedra Bitcoin

Very good diversification

The 3 months correlation between Blockmate and Cathedra is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Blockmate Ventures and Cathedra Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cathedra Bitcoin and Blockmate Ventures 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 Blockmate Ventures are associated (or correlated) with Cathedra Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cathedra Bitcoin has no effect on the direction of Blockmate Ventures i.e., Blockmate Ventures and Cathedra Bitcoin go up and down completely randomly.

Pair Corralation between Blockmate Ventures and Cathedra Bitcoin

Assuming the 90 days horizon Blockmate Ventures is expected to generate 2.29 times more return on investment than Cathedra Bitcoin. However, Blockmate Ventures is 2.29 times more volatile than Cathedra Bitcoin. It trades about 0.18 of its potential returns per unit of risk. Cathedra Bitcoin is currently generating about 0.02 per unit of risk. If you would invest  2.50  in Blockmate Ventures on September 4, 2024 and sell it today you would earn a total of  5.50  from holding Blockmate Ventures or generate 220.0% return on investment over 90 days.

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

Blockmate Ventures  vs.  Cathedra Bitcoin

Blockmate Ventures

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Blockmate Ventures are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Blockmate Ventures reported solid returns over the last few months and may actually be approaching a breakup point.

Cathedra Bitcoin

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cathedra Bitcoin are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Cathedra Bitcoin may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Blockmate Ventures and Cathedra Bitcoin

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

The idea behind Blockmate Ventures and Cathedra Bitcoin 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.