Question 1

What does crypto correlation coefficient mean?

Accepted Answer

The correlation coefficient measures how closely two cryptocurrencies' prices move together, ranging from -1 to +1. +1 means perfectly correlated (move together), -1 means inversely correlated, and 0 means no correlation.

Question 2

How can I use correlation analysis to optimize my portfolio?

Accepted Answer

Choose coins with low or negative correlation to diversify risk. For example, if BTC drops but you hold negatively correlated assets, your overall portfolio losses can be reduced.

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