Correlation Between Highstreet and Bitcoin SV

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

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

Diversification Opportunities for Highstreet and Bitcoin SV

0.31

Correlation Coefficient

Highstreet  Bitcoin SV

Weak diversification

The 3 months correlation between Highstreet and Bitcoin is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Highstreet and Bitcoin SV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitcoin SV and Highstreet 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 Highstreet are associated (or correlated) with Bitcoin SV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitcoin SV has no effect on the direction of Highstreet i.e., Highstreet and Bitcoin SV go up and down completely randomly.

Pair Corralation between Highstreet and Bitcoin SV

Assuming the 90 days trading horizon Highstreet is expected to generate 96.8 times less return on investment than Bitcoin SV. In addition to that, Highstreet is 1.05 times more volatile than Bitcoin SV. It trades about 0.0 of its total potential returns per unit of risk. Bitcoin SV is currently generating about 0.1 per unit of volatility. If you would invest  3,821  in Bitcoin SV on August 6, 2024 and sell it today you would earn a total of  1,082  from holding Bitcoin SV or generate 28.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.48%
Values	Daily Returns

Highstreet  vs.  Bitcoin SV

Highstreet

Risk-Adjusted Performance

0 of 100

Weak

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

Bitcoin SV

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bitcoin SV are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Bitcoin SV exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Highstreet and Bitcoin SV

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

The idea behind Highstreet and Bitcoin SV 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.

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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.