Crypto - and traditional markets KW9 – Bitcoin, despite the Dump at the top

the Continue of the Bitcoin market moves extremely independent of all comparison of assets. In spite of the fall on the last Sunday of the Performance Bitcoins is significantly higher than that of the comparison assets.

Dr. Philipp Giese
3. March 2019BTC$3.799,16 -0.73%part Facebook Twitter LinkedIn xing mail

For some months now, we keep track of how Bitcoin fails in comparison to traditional markets. This is not a trivial comparison of the Performance. Institutional investors are interested in Bitcoins claim to be a non-correlated, stable Asset, extremely. Some time ago, I have dedicated myself to the part of a guest contribution on the €uro Fund research, the question of whether Bitcoin and the strongly correlated crypto market would be a good addition to classic portfolio. This question is the institutional investors in the crypto-market is interested in, less of a hope of a new Bull Run like the end of 2017. to clarify

the Suitability of classical Portfolios can be considered an Investor in various sizes. For one, it would be interesting to see whether and how much Bitcoin linked to traditional markets. On the other, a stable Asset for a long-term Investment is attractive. The volatility of the asset do not need to be extremely low. You should have at least over a longer period of time, a certain degree of stability.

How to develop the relationship between Bitcoin and the traditional markets?

Since the beginning of November, we are therefore pursuing, and how Bitcoin compares to traditional markets. We pay attention to the correlation in the last month, on a sliding correlation of a continuous volatility and a sliding Performance. The last three values are calculated for each day based on the last 30 days. As a comparison, assets in traditional markets, we consider indices S&P 500, Dax and Nikkei, Oil and Gold.

The image is well-known: As in the past few weeks, XRP is still the entkoppeltste Asset of the Top 3. In contrast, the correlation of the Top 3 crypto currencies are still very high:

As Bitcoin is the reserve currency within the crypto Ecosystem and institutional investors as the first on this view, it is sufficient, if we focus on currencies when compared to the traditional market on the biggest of all Crypto.

correlation: crypto-currencies vs. traditional market

Similarly mixed as in the last few weeks, the correlations between Bitcoin and the traditional markets. As of last week, Oil, Gold and the S&P 500 have a positive correlation with the crypto-currency, with respect to the DAX and Nikkei, this is negative. The result, however, is that the coupling between the classical and the crypto-market is minimal. The Nikkei Index has a similar low correlation to the rest of the market, which is due to the fact that the correlations from the Nikkei Index to the Bitcoin exchange rate and for the DAX, compensate each other almost:

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remained The correlations of Bitcoin the other Assets as in the previous week, so positive for Oil, Gold and the S&P 500, negative for the Nikkei and the DAX where the correlations between the Bitcoin price and S&P500, DAX, Gold and the Nikkei to rise, while it falls for the coupling to the Oil:

Overall, the absolute mean correlation Bitcoins with other markets with 26 percent of the lowest. We take into account compensation effects by any of the anti-correlations, Bitcoin is correlated only to 16 percent for the rest of the market.

Performance of Bitcoin, in spite of a lower volatility than other Assets

rose, of Course: the youngest of The Dump led to a further Increase of the volatility. However, the average volatility for the last 30 days will continue to move at just under three percent:

Even with the price drop from last Sunday, nothing has changed, that the Performance of Bitcoins is still better than all the rest of the Assets:

a presentation on the Bitcoin as an interesting Investment opportunity. The correlation to the traditional markets, a still manageable volatility and the best Performance, ensure continuing interest on the part of institutional investors.

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

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