Leading cryptocurrency Bitcoin (BTC) has experienced less volatility than Telsa stocks (TLSA) in recent months according to the latest reports. This is quite surprising given the reputation of Bitcoin as a highly volatile asset when compared to traditional stocks.
Surprise Stability in 30 Days Chart
Analysis firm Skew posted a chart on Twitter which showed that Bitcoin experienced a below -1.24 movement in 14 out of the last 27 days which represented 52% of the time which was in contrast to Telsa which only achieved this range 6% of the time.
Bitcoin 30-day historical volatility has also dropped by 55% in the past month which is one of the lowest in recent months.
Furthermore, the 30 days implied volatility of Bitcoin, an index used by investors to determine how volatile the price of the asset would be for the next month has declined to less than 45% which is a two-year low for the leading coin. This is in contrast to historical expectations whereby big moves have been preceded by the implied volatility of less than 50%.
Tesla meanwhile has witnessed daily percentage volatility since the end of June with wide swings from the popular tech stock. This was partly driven by the Telsa stock price hitting an all-time high of nearly $2,000 per unit on August 20th which was preceded by a 45% jump in price in 10 consecutive days.
Similarities between Bitcoin and Tesla
Bitcoin and Telsa have been compared by analysts due to some similarities between the movements of assets. Tesla hit a low of nearly $361 in March which was around the point Bitcoin also hit a low of nearly $3,800.
Since then, both assets have taken a positive move in the market with Bitcoin hitting around $12,000 and Telsa hitting $2000 highs. Despite these similarities, Bitcoin’s unique qualities make it an attractive investment since it has a more realistic entry point. Although unlike Telsa it does not offer cash flows and has also been a challenge for traditional investors to understand its value.
Although this has begun to change as more institutions have begun to accumulate Bitcoin as a hedge against the financial markets that have struggled to recover post-pandemic lockdown. As at the time of writing Bitcoin is trading at $10,832 representing over 1.5% gain in the past 24 hours.
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