Correlation Between Valkyrie Bitcoin and IShares IBoxx

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

By analyzing existing cross correlation between Valkyrie Bitcoin Miners and iShares iBoxx Investment, you can compare the effects of market volatilities on Valkyrie Bitcoin and IShares IBoxx 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 IShares IBoxx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valkyrie Bitcoin and IShares IBoxx.

Diversification Opportunities for Valkyrie Bitcoin and IShares IBoxx

-0.58

Correlation Coefficient

Valkyrie Bitcoin  IShares IBoxx

Excellent diversification

The 3 months correlation between Valkyrie and IShares is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Valkyrie Bitcoin Miners and iShares iBoxx Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares iBoxx Investment 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 Miners are associated (or correlated) with IShares IBoxx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares iBoxx Investment has no effect on the direction of Valkyrie Bitcoin i.e., Valkyrie Bitcoin and IShares IBoxx go up and down completely randomly.

Pair Corralation between Valkyrie Bitcoin and IShares IBoxx

Given the investment horizon of 90 days Valkyrie Bitcoin Miners is expected to under-perform the IShares IBoxx. In addition to that, Valkyrie Bitcoin is 10.21 times more volatile than iShares iBoxx Investment. It trades about -0.14 of its total potential returns per unit of risk. iShares iBoxx Investment is currently generating about 0.03 per unit of volatility. If you would invest  10,404  in iShares iBoxx Investment on January 14, 2025 and sell it today you would earn a total of  119.00  from holding iShares iBoxx Investment or generate 1.14% return on investment over 90 days.

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

Valkyrie Bitcoin Miners  vs.  iShares iBoxx Investment

Valkyrie Bitcoin Miners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Valkyrie Bitcoin Miners has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Etf's primary indicators remain fairly strong which may send shares a bit higher in May 2025. The recent confusion may also be a sign of long-lasting up-swing for the Etf traders.

iShares iBoxx Investment

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in iShares iBoxx Investment are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, IShares IBoxx is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Valkyrie Bitcoin and IShares IBoxx

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

The idea behind Valkyrie Bitcoin Miners and iShares iBoxx Investment 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.