Crypto - and traditional markets KW48 – volatility of Bitcoin so high for months

the courses of XRP and Bitcoin are back linked. In addition, the volatility of bitcoin is significantly higher than that of the traditional markets.

Dr. Philipp Giese
At the 2. December 2018 share Facebook Twitter LinkedIn xing mail

What good is Bitcoin and the strongly correlated crypto market as a random Asset? Decoupled from the traditional markets from the crypto-market? And how strong the volatility is bitcoin?

The sizes of the correlation and volatility are just for institutional investors: A low correlation with traditional markets such as the S&P500, the DAX or the Dow Jones would confirm that the crypto-market for institutional investors could be interesting. It would be for a greater diversification of the portfolio is helpful. Another Monitor, the volatility is high volatility and the associated risk deters institutional investors.

Since the beginning of November, we keep track of how Bitcoin fails in comparison to traditional markets. We look, therefore, on the correlation in the last month, on a sliding correlation and a sliding volatility. The last two values are calculated for each day based on the last 30 days. Since the correlations within the crypto market is very similar behavior, and currently BTC for institutional investors, the most interesting, we focus mostly on the Bitcoin price.

of The 14. November commenced sale on the crypto-market. The volatility is also back. In the last week, we said that, at least temporarily, the prices of XRP and Bitcoin were independent of each other. Now this is not to say, the correlation between these two Assets is rising again:

correlation: crypto-currencies vs. traditional market

at The moment that is quite interesting: The correlation of the Dow Jones and the S&P500 is currently very strong. Accordingly, Bitcoin is currently about the correlation to other markets in the midfield. Both Oil and Gold have a lower correlation:

This picture is confirmed when looking at the current correlations. While Bitcoin Oil, Gold and the DAX is still decoupled almost completely, is the correlation to the indexes Dow Jones and S&P 500 at least to 0.3:

Bitcoins volatility: And you continue to rise!

Of course, the fall of 14. November was not only an end to the Sideways trend, but also an end to the decline in volatility. Meanwhile, the monthly volatility has increased again to a Level that you saw last time beginning of may. The volatility of Oil Futures, although it is far behind that of Bitcoin, the Rise and indeed already since August. The rest of the considered Assets is to be stable:

Currently, the case invites the end of the crypto-market is rather little to large Investments. The volatility makes Bitcoin for traders interesting again, however, the case is decoupling from the us markets a negative Signal that you should keep in mind.