Correlation Between SEELE and Bitcoin

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

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

Diversification Opportunities for SEELE and Bitcoin

0.0

Correlation Coefficient

SEELE  Bitcoin

Pay attention - limited upside

The 3 months correlation between SEELE and Bitcoin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SEELE and Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitcoin and SEELE 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 SEELE are associated (or correlated) with Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitcoin has no effect on the direction of SEELE i.e., SEELE and Bitcoin go up and down completely randomly.

Pair Corralation between SEELE and Bitcoin

If you would invest  5,748,184  in Bitcoin on September 1, 2024 and sell it today you would earn a total of  3,944,730  from holding Bitcoin or generate 68.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

SEELE  vs.  Bitcoin

SEELE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SEELE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, SEELE is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Bitcoin

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin are ranked lower than 20 (%) 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.

Pair Trading with SEELE and Bitcoin

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

The idea behind SEELE and 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.