Correlation Between MCO and Bitcoin Gold
Can any of the company-specific risk be diversified away by investing in both MCO and Bitcoin Gold 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 MCO and Bitcoin Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MCO and Bitcoin Gold, you can compare the effects of market volatilities on MCO and Bitcoin Gold 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 MCO with a short position of Bitcoin Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCO and Bitcoin Gold.
Diversification Opportunities for MCO and Bitcoin Gold
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between MCO and Bitcoin is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding MCO and Bitcoin Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitcoin Gold and MCO 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 MCO are associated (or correlated) with Bitcoin Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitcoin Gold has no effect on the direction of MCO i.e., MCO and Bitcoin Gold go up and down completely randomly.
Pair Corralation between MCO and Bitcoin Gold
Assuming the 90 days trading horizon MCO is expected to generate 39.83 times more return on investment than Bitcoin Gold. However, MCO is 39.83 times more volatile than Bitcoin Gold. It trades about 0.22 of its potential returns per unit of risk. Bitcoin Gold is currently generating about -0.05 per unit of risk. If you would invest 84.00 in MCO on January 17, 2024 and sell it today you would earn a total of 1,241 from holding MCO or generate 1477.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MCO vs. Bitcoin Gold
Performance |
| Timeline |
| MCO |
| Bitcoin Gold |
MCO and Bitcoin Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCO and Bitcoin Gold
The main advantage of trading using opposite MCO and Bitcoin Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCO position performs unexpectedly, Bitcoin Gold 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 Gold will offset losses from the drop in Bitcoin Gold's long position.The idea behind MCO and Bitcoin Gold 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.| Bitcoin Gold vs. Bitcoin | Bitcoin Gold vs. Dogecoin | Bitcoin Gold vs. Bitcoin Cash | Bitcoin Gold vs. Litecoin |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| AI Investment Finder Use AI to screen and filter profitable investment opportunities |