Correlation Between Valkyrie Bitcoin and Invesco SP

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

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

Diversification Opportunities for Valkyrie Bitcoin and Invesco SP

0.79

Correlation Coefficient

Valkyrie Bitcoin  Invesco SP

Poor diversification

The 3 months correlation between Valkyrie and Invesco is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Valkyrie Bitcoin Futures and Invesco SP SmallCap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco SP SmallCap and Valkyrie Bitcoin 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 Valkyrie Bitcoin Futures are associated (or correlated) with Invesco SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco SP SmallCap has no effect on the direction of Valkyrie Bitcoin i.e., Valkyrie Bitcoin and Invesco SP go up and down completely randomly.

Pair Corralation between Valkyrie Bitcoin and Invesco SP

Given the investment horizon of 90 days Valkyrie Bitcoin Futures is expected to generate 3.37 times more return on investment than Invesco SP. However, Valkyrie Bitcoin is 3.37 times more volatile than Invesco SP SmallCap. It trades about 0.14 of its potential returns per unit of risk. Invesco SP SmallCap is currently generating about 0.07 per unit of risk. If you would invest  4,312  in Valkyrie Bitcoin Futures on May 6, 2025 and sell it today you would earn a total of  1,502  from holding Valkyrie Bitcoin Futures or generate 34.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Valkyrie Bitcoin Futures  vs.  Invesco SP SmallCap

Valkyrie Bitcoin Futures

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Valkyrie Bitcoin Futures are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, Valkyrie Bitcoin showed solid returns over the last few months and may actually be approaching a breakup point.

Invesco SP SmallCap

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco SP SmallCap are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable fundamental indicators, Invesco SP is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Valkyrie Bitcoin and Invesco SP

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

The idea behind Valkyrie Bitcoin Futures and Invesco SP SmallCap 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.