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Crypto - and traditional markets: Bitcoin – despite a weak Performance in an attractive way?

The Bitcoin price has currently a very low correlation to the comparison markets. The volatility from the Bitcoin price is still at 3 percent. Unfortunately, th

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Crypto - and traditional markets: Bitcoin – despite a weak Performance in an attractive way?

The Bitcoin price has currently a very low correlation to the comparison markets. The volatility from the Bitcoin price is still at 3 percent. Unfortunately, the Performance is also influenced in this week from the price collapse of the end of September.

Dr. Philipp Giese
20. October 2019BTC$9.419,62 , and 0.41%part Facebook Twitter LinkedIn xing mail

For almost a year, 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. In a guest contribution on the €uro Fund research dedicated to BTC-ECHO 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. In order to clarify the Suitability of classical Portfolios can be considered an Investor in various sizes:

the correlation between the Bitcoin price and the traditional markets nThe volatility and Performance the Bitcoin-course

We pay attention in this series of articles, therefore, on these three sizes. You will be charged for each day on the Basis of the last 30 days. As a comparison, assets in traditional markets, we consider indices S&P 500, Nikkei and Dax, as well as Oil and Gold.

coupling Bitcoins to traditional markets so low as not in a long time

at first glance, it is striking that the price of Bitcoin presents to the rest of the markets, a very weak coupling. While the rest of the Assets can just have to Oil strong correlations, the correlations to the Bitcoin is less than 20 percent. Weak negative coupling between the Bitcoin price and the DAX and the Nikkei Index, on the other hand, is the other comparison assets, the Bitcoin is positively correlated:

we Look at the temporal development of the correlations between Bitcoin and the traditional comparison of the assets, we see that these couplings since the end of September, overall, a slight downward trend can show. An exception to Oil is, however, to increases the coupling of Bitcoin for about a week:

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The absolute mean correlation with the other markets is similar to that in the last few weeks, the shortage of 9 per cent. For Bitcoin to with a large distance has the smallest absolute correlation in our market comparison. On the second place-correlated to the rest of the market, the Nikkei Index, with 18 percent already. The remaining Assets have absolute correlations of 20-30 percent for the rest of the market. The image of a strong independent Assets is not diminished by a consideration of compensation effects: a very low three percent, the price of Bitcoin is almost completely independent from the rest of the market. The Nikkei Index is -10 percent, and Gold with -11 percent, on the other hand have a clear anti-correlation.

volatility from the Bitcoin price stable at just under 3 percent

a volatility of three percent is Slowly becoming the new Standard for Bitcoin: Since the end of September, you can maintain this level. The volatility of Oil moving about in the same height, could this at 14. October fall dramatically. It now stands at about 1.3 percent, and thus almost at the height of the rest of the comparison assets:

Bitcoin price still the class of the last

A very independent behavior from the traditional market means, unfortunately, this time, nothing Positive: The Performance of Bitcoin is still underground. With approximately -0.7 percent daily Performance of Bitcoin is far behind the rest of the Assets in our market comparison. Similar as in the case of volatility, the only "competitor" of Oil, whose Performance is also strongly negative. All other Assets have a medium daily Performance of the 0 percent:

of Course, to say that the blame for the poor performance of bitcoin in this market compared to the price fall of 24. September is. In this market comparison we will consider a month-averaged daily Performance, so that is to be expected with a rapid increase in this Performance.

when looking at the development of a hypothetical, one-time investment over the course of the last month of the quarter, since the beginning of the year and for a year, is confirmed at first glance, the picture of the last weeks:

Again: the Take-Home Message is that long-term Investment is worth it. So far So good, I would like to think. Currently, it is striking, however, that the aggregate Performance has declined Bitcoins in total, compared to last week:

Whether this is merely a fluctuation or a long-term Trend, you will need to observe. Nevertheless still applies: long-Term investors to benefit. The dramatic Drawdown in the last year, the price of Bitcoin between February and December 2018, experienced, changes nothing to the fact that the price of Bitcoin has between October 2018 and October 2019, is still the clear frontrunner.

Also, in the case of poor Performance, the existing independence of the Bitcoin course from the rest of the market for institutional investors is interesting. On the market comment from Tuesday, 15. October, pointed to the Trading Team of Bitwala to an increase in addresses with over 1000 BTC. This can also be an indication of a growing institutional interest.

data on 18. October cryptocompare.com, finance.yahoo.com and fred.stlouisfed.org used.

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