Correlation Between Bitcoin Cash and MONA
Can any of the company-specific risk be diversified away by investing in both Bitcoin Cash and MONA 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 Cash and MONA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitcoin Cash and MONA, you can compare the effects of market volatilities on Bitcoin Cash and MONA 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 Cash with a short position of MONA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitcoin Cash and MONA.
Diversification Opportunities for Bitcoin Cash and MONA
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bitcoin and MONA is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Bitcoin Cash and MONA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MONA and Bitcoin Cash 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 Cash are associated (or correlated) with MONA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MONA has no effect on the direction of Bitcoin Cash i.e., Bitcoin Cash and MONA go up and down completely randomly.
Pair Corralation between Bitcoin Cash and MONA
Assuming the 90 days trading horizon Bitcoin Cash is expected to generate 2.62 times more return on investment than MONA. However, Bitcoin Cash is 2.62 times more volatile than MONA. It trades about 0.17 of its potential returns per unit of risk. MONA is currently generating about 0.0 per unit of risk. If you would invest 26,314 in Bitcoin Cash on January 21, 2024 and sell it today you would earn a total of 21,588 from holding Bitcoin Cash or generate 82.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bitcoin Cash vs. MONA
Performance |
| Timeline |
| Bitcoin Cash |
| MONA |
Bitcoin Cash and MONA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bitcoin Cash and MONA
The main advantage of trading using opposite Bitcoin Cash and MONA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitcoin Cash position performs unexpectedly, MONA 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 MONA will offset losses from the drop in MONA's long position.| Bitcoin Cash vs. Bitcoin | Bitcoin Cash vs. Dogecoin | Bitcoin Cash vs. Litecoin | Bitcoin Cash vs. Ethereum Classic |
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 the Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |