Crypto - and traditional markets KW51 – return of Bitcoin is catching on

the correlation to Oil is falling sharply, so that Bitcoin and Oil are now negatively correlated. The volatility actually found a Plateau at about 0.05 percent, while the yield rose to the level of the indices S&P500, the DAX and the Dow Jones.

Dr. Philipp Giese
24. December 2018ShareFacebookTwitterLinkedInxingemail

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 scare off 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 behavior very similar to BTC for institutional investors, is currently the most interesting, we focus mostly on the Bitcoin price.

With a decent Rebound to further price losses in the case of Bitcoin, XRP, and Ethereum could be avoided. The volatility is also back. Bitcoins and Ethereums coupling XRP is almost on a par with the between Ethereum and Bitcoin:

also, you can restrict the view on Bitcoin, qualitatively, the results are undoubtedly transferable.

correlation: crypto-currencies vs. traditional market

Bitcoins correlation to the classical values has changed since last week. The coupling to Gold is against become spacious and the rose Gold dramatically. Currently, the correlation between Bitcoin and Gold is greater than in all the other cases (with the exception of between the indices Dow Jones and S&P 500). Not the only reason why Bitcoin makes the claim of a "digital gold". Currently, the mother of all crypto-currencies, in fact, the entkoppelste Asset:

This picture is confirmed when looking at the current correlations. The couplings to Oil and Gold are the most – albeit with different signs – while the correlations of the three indices, the S&P 500, the DAX and the Dow Jones fell almost to Zero:

volatility of Bitcoin give more in a saturation

admittedly, The volatility of Bitcoin is significantly higher than that of other Assets. Even the Oil faded against bitcoin fluctuations. Positive is however to be noted that the volatility has actually found a Plateau:

The monthly rate of return is still negative, but now on the height of the three indices S&P 500, the DAX and the Dow Jones increased. Although the monthly rate of return could not beat the Gold, however, is currently much more about the Oil:

Even if Bitcoins volatility would remain high, that would be at least an uncertainty of how investors can count on. A certain degree of stability can be seen. According to Bitcoin, invites you to a real Investment.

data on the Basis of cryptocompare.com, finance.yahoo.com and fred.stlouisfed.org