Definition

Correlation is a statistical measure that describes the strength and direction of a relationship between two variables. It is expressed on a scale from -1 to +1, where:
+1 indicates a perfect positive correlation (both variables move in the same direction),
-1 indicates a perfect negative correlation (one variable moves in the opposite direction to the other),
0 indicates no linear relationship between the variables.

Crypto beta (β) is a measure that evaluates the relative volatility of a specific cryptocurrency asset compared to a broader market benchmark, such as a cryptocurrency index or another reference asset. Our data provides insights into how a particular crypto asset's price movements correlate with those of the benchmark.

Realized volatility is a measure of the actual price fluctuations of a cryptocurrency asset over a specified period, based on historical data. It quantifies how much the price of the asset has changed over a set number of past trading days. This measure is calculated using high and low prices, often employing methods like the Parkinson method, which is known for its effectiveness in capturing volatility by considering the range of price movements. In the context of the Amberdata API, realized volatility provides valuable insights into the historical volatility of crypto assets, helping investors and analysts understand past market behavior and assess potential risk and stability.

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Details

For correlation, Amberdata shows the 30, 90 and 180-day rolling correlation between the first pair and second pair.

For beta, Amberdata shows the 30, 90 and 180-day rolling beta between the first pair and second pair, in units of the first pair.

For realized volatility, Amberdata shows the 30, 90 and 180-day Parkinson realized volatility for the first pair parameter.

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Availability

/Correlation, Beta and Realized Volatility

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Frequently Asked Questions

How can these measures help me understand and manage investment risk?

• Correlation helps investors understand the relationship between different investments, allowing them to spread out risk more effectively. Beta provides insights into how risky an investment is compared to the overall market, helping investors gauge potential volatility and returns. Realized volatility shows how much an investment's price has actually changed in the past, offering a practical view of market behavior. Together, these measures give investors a clearer picture of market dynamics, enabling smarter decisions to manage risk.