Correlation Between Bitwise Funds and Strategy Shares

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

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

Diversification Opportunities for Bitwise Funds and Strategy Shares

0.09

Correlation Coefficient

Bitwise Funds  Strategy Shares

Significant diversification

The 3 months correlation between Bitwise and Strategy is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Bitwise Funds Trust and Strategy Shares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategy Shares and Bitwise Funds 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 Bitwise Funds Trust are associated (or correlated) with Strategy Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategy Shares has no effect on the direction of Bitwise Funds i.e., Bitwise Funds and Strategy Shares go up and down completely randomly.

Pair Corralation between Bitwise Funds and Strategy Shares

Given the investment horizon of 90 days Bitwise Funds Trust is expected to generate 715.16 times more return on investment than Strategy Shares. However, Bitwise Funds is 715.16 times more volatile than Strategy Shares. It trades about 0.15 of its potential returns per unit of risk. Strategy Shares is currently generating about 0.22 per unit of risk. If you would invest  0.00  in Bitwise Funds Trust on May 15, 2025 and sell it today you would earn a total of  3,868  from holding Bitwise Funds Trust or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	75.41%
Values	Daily Returns

Bitwise Funds Trust  vs.  Strategy Shares

Bitwise Funds Trust

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bitwise Funds Trust are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak primary indicators, Bitwise Funds exhibited solid returns over the last few months and may actually be approaching a breakup point.

Strategy Shares

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Strategy Shares are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Strategy Shares is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bitwise Funds and Strategy Shares

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

The idea behind Bitwise Funds Trust and Strategy Shares 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.