Correlation Between BTCS and MGT Capital

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

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

Diversification Opportunities for BTCS and MGT Capital

0.0

Correlation Coefficient

BTCS  MGT Capital

Pay attention - limited upside

The 3 months correlation between BTCS and MGT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BTCS Inc and MGT Capital Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGT Capital Investments and BTCS 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 BTCS Inc are associated (or correlated) with MGT Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGT Capital Investments has no effect on the direction of BTCS i.e., BTCS and MGT Capital go up and down completely randomly.

Pair Corralation between BTCS and MGT Capital

If you would invest  0.05  in MGT Capital Investments on February 4, 2024 and sell it today you would earn a total of  0.00  from holding MGT Capital Investments or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.35%
Values	Daily Returns

BTCS Inc  vs.  MGT Capital Investments

BTCS Inc

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BTCS Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile fundamental indicators, BTCS may actually be approaching a critical reversion point that can send shares even higher in June 2024.

MGT Capital Investments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MGT Capital Investments has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, MGT Capital is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with BTCS and MGT Capital

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

The idea behind BTCS Inc and MGT Capital Investments 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 Directory module to find actively traded commodities issued by global exchanges.