Correlation

Correlation 📈

The Correlation endpoint provides traders with information that can be leveraged to help determine how closely correlated assets are to one another (e.g., Bitcoin price movement compared to Ethereum).

Parameters: TOKEN_ID, SYMBOL, EXCHANGE, CATEGORY

Datapoints:

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TOKEN_ID

The token ID of the asset of interest (e.g., the Token ID of BTC is 3375).

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TOKEN_NAME

Token Name of the asset of interest (e.g., the Token Name of BTC is Bitcoin).

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TOKEN_SYMBOL

The symbol of the asset of interest (e.g., BTC).

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DATE

The date of the record.

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TOP_CORRELATION

The top 10 and bottom 10 correlation within the top 100 market cap tokens.

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Visualize on Token Metrics Application:

Go to the Token Metrics Summary Page and then click on the Correlation tab on the left side under Investor. From there, select Details to view the correlation metrics in full.

Screenshot from Token Metrics Application: Coins that are most closely correlated with Bitcoin:

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Example Use Case:

Example use-case, use-case

A trader can use the Correlation endpoint to help diversify their portfolio and reduce risk. For example, if a trader holds Bitcoin in their portfolio, they would want to select an asset that is negatively correlated with Bitcoin to supplement their position and potentially mitigate potential losses. The correlation coefficient can provide valuable insight into the relationship between two assets, helping the trader to make informed decisions about how to manage their portfolio.