Is Bitcoin correlated to the Stock Market?

Bitcoin has emerged as an alternative asset class; but does it really offer any diversification?

Although the future prices can move in any direction, below you will find data going back to 2014 to show you how it has historically behaved.

From the chart, you can see that it definitely hasn't been negatively correlated. The most recent 12 months it had a 0.33 correlated move with the S&P 500. It doesn't look like it has provided great diversification during the 2020 Covid-19 sell off either (reaching as higher than 0.70).

So although past performance may not indicate future performance, it looks like Bitcoin is moderately positively correlated to S&P 500 (SPY), but has historically gotten very high when the stock market sharply falls.

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