Taking advantage
of hedge funds strategies
Correlations can serve as a strong tool for investors and traders.
The relation shows the level of similarity in assets price moves and how they react in the same market
conditions.
Closely related assets can go up or down at the same time.Thus high correlation can generate trading signals or be a tool to leverage position.
Assets which move in the opposite directions (one goes up, the other goes down) can be hedged against each other.
Less correlated or uncorrelated assets are perfect for portfolio optimisation. Investors can lower the risk or accelerate profits.
How to identify cryptocurrencies correlations
Correlation chart
The tool helps to observe how the correlation coefficient changes in time.
Choose assets you want to follow and watch their rates with correlation fluctuations simultaneously.
Correlation matrix
The tool is useful when preselecting digital assets for investment portfolio.
Select the assets to compare and get the algorithmic calculation of the correlation between their
returns.
Some examples of the correlations between crypto currencies.
| BTC | ETH | DOGE | PAXG | BNB | MKR | |
|---|---|---|---|---|---|---|
| BTC | 1.00 | 0.57 | 0.11 | 0.23 | 0.53 | 0.15 |
| ETH | 0.57 | 1.00 | 0.28 | 0.21 | 0.54 | 0.23 |
| DOGE | 0.11 | 0.28 | 1.00 | 0.07 | 0.19 | 0.08 |
| PAXG | 0.23 | 0.21 | 0.07 | 1.00 | 0.15 | 0.14 |
| BNB | 0.53 | 0.54 | 0.19 | 0.15 | 1.00 | 0.43 |
| MKR | 0.15 | 0.23 | 0.08 | 0.14 | 0.43 | 1.00 |
Crypto assets derivatives
In the crypto ancient times securing positions was a hard nut to crack due to lack of the appropriate instruments and low liquidity.
Nowadays centralised exchanges deliver multiple markets with the sharply increasing trading volumes.
There is a wide range of Futures and Perpetual Swaps on many crypto exchanges.
In addition next synthetic assets are delivered by plenty of new DeFi platforms.
Consequently crypto traders can leverage and hedge trading positions by using derivatives which follow the spot market prices.
Derivatives to hedge
Traders can choose from the wide range of investment instruments to secure positions both within the closed time frames and perpetually. Check how to hedge your asset from the current database of derivatives.
Derivatives to leverage
Famous cryptocurrencies volatility make them attractive for traders who want to use leverage when trading. There are many trading venues with rich variety of futures, perpetual swaps, options, leveraged tokens etc. Just choose the token to list them all.