Correlation Between Bitwise Funds and YieldMax MSTR

Can any of the company-specific risk be diversified away by investing in both Bitwise Funds and YieldMax MSTR 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 YieldMax MSTR 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 YieldMax MSTR Option, you can compare the effects of market volatilities on Bitwise Funds and YieldMax MSTR 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 YieldMax MSTR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitwise Funds and YieldMax MSTR.

Diversification Opportunities for Bitwise Funds and YieldMax MSTR

0.98

Correlation Coefficient

Bitwise Funds  YieldMax MSTR

Almost no diversification

The 3 months correlation between Bitwise and YieldMax is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Bitwise Funds Trust and YieldMax MSTR Option in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YieldMax MSTR Option 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 YieldMax MSTR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YieldMax MSTR Option has no effect on the direction of Bitwise Funds i.e., Bitwise Funds and YieldMax MSTR go up and down completely randomly.

Pair Corralation between Bitwise Funds and YieldMax MSTR

Given the investment horizon of 90 days Bitwise Funds is expected to generate 1.8 times less return on investment than YieldMax MSTR. But when comparing it to its historical volatility, Bitwise Funds Trust is 1.05 times less risky than YieldMax MSTR. It trades about 0.03 of its potential returns per unit of risk. YieldMax MSTR Option is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1,943  in YieldMax MSTR Option on April 30, 2025 and sell it today you would earn a total of  132.00  from holding YieldMax MSTR Option or generate 6.79% return on investment over 90 days.

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

Bitwise Funds Trust  vs.  YieldMax MSTR Option

Bitwise Funds Trust

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bitwise Funds Trust are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Bitwise Funds is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

YieldMax MSTR Option

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in YieldMax MSTR Option are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, YieldMax MSTR may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Bitwise Funds and YieldMax MSTR

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

The idea behind Bitwise Funds Trust and YieldMax MSTR Option 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.