Correlation Between Binance Coin and True USD
Can any of the company-specific risk be diversified away by investing in both Binance Coin and True USD 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 Binance Coin and True USD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binance Coin and True USD, you can compare the effects of market volatilities on Binance Coin and True USD 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 Binance Coin with a short position of True USD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binance Coin and True USD.
Diversification Opportunities for Binance Coin and True USD
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Binance and True is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Binance Coin and True USD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on True USD and Binance Coin 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 Binance Coin are associated (or correlated) with True USD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of True USD has no effect on the direction of Binance Coin i.e., Binance Coin and True USD go up and down completely randomly.
Pair Corralation between Binance Coin and True USD
If you would invest 58,345 in Binance Coin on January 27, 2024 and sell it today you would earn a total of 2,925 from holding Binance Coin or generate 5.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binance Coin vs. True USD
Performance |
| Timeline |
| Binance Coin |
| True USD |
Binance Coin and True USD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binance Coin and True USD
The main advantage of trading using opposite Binance Coin and True USD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binance Coin position performs unexpectedly, True USD 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 True USD will offset losses from the drop in True USD's long position.| Binance Coin vs. Staked Ether | Binance Coin vs. Cronos | Binance Coin vs. Wrapped Bitcoin | Binance Coin vs. Monero |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |