Understanding BTC Correlation
BTC Correlation measures how closely an altcoin's price moves with Bitcoin — important for portfolio diversification.
Weight: 8%
What is BTC Correlation?
BTC Correlation measures the statistical relationship between an altcoin's price movement and Bitcoin's. A correlation of 1.0 means they move identically; 0.0 means completely independent; -1.0 means opposite.
Why It Matters
If every coin in your portfolio is highly correlated with Bitcoin, you have no real diversification. Coins with lower BTC correlation provide genuine portfolio diversification and may outperform during altcoin seasons.
How We Use It
BTC Correlation is weighted at 8% in our Value Score. We use 7-day price change divergence as a proxy — coins showing independent price action score higher for diversification value.