Diversification Score measures how spread your Portfolio Tracker book is — not just how many coins you hold, but how evenly value is distributed and how correlated names are to Bitcoin.
It complements Portfolio Health (overall grade) and Risk Exposure (vol/VaR). Logged-in users get daily score snapshots.
What is this tool?
A 0–100 score built from effective N, entropy, concentration, bucket balance and BTC correlation.
Findings highlight concentration and correlation issues.
Per-coin weights and corr-to-BTC for the live book.
How to read the results
Effective N ≈ 1/HHI: how many equal-weight names the book behaves like.
Entropy (normalized) rises when weights are more equal.
Bucket balance rewards spreading across BTC / ETH / alt / stable.
High average corr to BTC lowers the correlation component.
Key signals and metrics
Score components are weighted; concentration and effective N matter most.
Corr BTC comes from Risk Exposure stats when available.
Stables count toward bucket balance but have near-zero BTC correlation.
Advanced usage and combinations
If score is low from concentration, use Rebalancing toward targets.
If score is low from correlation, add names with lower beta/corr or more stables.
Cross-check Risk Exposure when effective N is high but vol remains elevated.
Using this tool on PEPS Crypto
Populate holdings in Portfolio Tracker.
Open Diversification Score.
Read score, components and findings.
Adjust the book, then recalculate.
How it works
- Add holdings in Portfolio Tracker.
- Open Diversification Score.
- Read the score and component bars.
- Act on findings (trim top1, add buckets, lower corr).
- Recheck after updating Tracker quantities.
What to consider
- Equal weights maximize entropy for a given asset count — not always optimal.
- Many alts can still be highly correlated to BTC.
- Not financial or tax advice.
Frequently asked questions
- Is this the same as Portfolio Health?
- No — Health blends several pillars including P&L and market fit. This tool focuses only on diversification math.
- What is Effective N?
- 1 / HHI. A book of 10 coins where one is 80% has low Effective N.
- Where does correlation come from?
- From rxp_coin_stats (daily returns vs BTC) when present; otherwise defaults by bucket.
Conclusion
Diversification reduces idiosyncratic risk — it does not remove market risk.
Not financial advice.