BTC vs XAG: Returns, Risk & Volatility (2025)

Written by Gale Finance Team

Reviewed by Sid Kalla CFA Charterholder

Analysis period: 2025-01-01 to 2025-12-31

BTC Total Return

↓ -8.7%

XAG Total Return

↑ +157.9%

Relative Performance of BTC vs XAG (Normalized to 100)

BTC XAG

Normalized to 100 at start date for comparison

Key Takeaways

Total Return: BTC delivered a -8.7% total return, while XAG returned +157.9% over the same period. XAG outperformed on total returns.
Risk-Adjusted Return (Sharpe Ratio): BTC had a negative Sharpe (-0.03) while XAG was positive (2.78), indicating XAG had meaningfully better risk-adjusted performance in this period.
Volatility (Annualized): BTC was more volatile, with 41.9% annualized volatility, versus 31.6% for XAG.
Maximum Drawdown: XAG's maximum drawdown was -13.6%, while BTC experienced a deeper drawdown of -32.1%.
Tail Risk (VaR & Expected Shortfall): At the 5% level (daily log returns), BTC's VaR was -3.65% and its Expected Shortfall (CVaR) was -5.07%; XAG's were -2.32% and -4.51%. VaR is the cutoff; Expected Shortfall is the average move on the worst days.
Skew & Kurtosis: Skew: BTC -0.03 vs XAG -0.41. Excess kurtosis: BTC 2.26 vs XAG 3.82. Negative skew leans downside; higher excess kurtosis means fatter tails.
Tail Days & Extremes: 2σ tail days (down/up): BTC 11/9, XAG 6/5. Worst day: BTC -8.63% (2025-03-03) vs XAG -8.02% (2025-12-29). Best day: BTC +9.60% (2025-03-02) vs XAG +9.18% (2025-12-26).
Risk ratios: Sortino - BTC: -0.04 vs. XAG: 4.38 , Calmar - BTC: -0.17 vs. XAG: 10.54 , Sterling - BTC: -0.40 vs. XAG: 10.32 , Treynor - BTC: -0.05 vs. XAG: 2.19 , Ulcer Index - BTC: 14.59% vs. XAG: 4.21%

Bitcoin vs Silver Correlation

0.24 Average Correlation

Bitcoin and Silver were weakly correlated in 2025. With a correlation of 0.24, these assets showed meaningful independence, offering diversification benefits when held together.

For portfolio construction, this weak correlation suggests that combining BTC and XAG could reduce overall portfolio variance. However, correlations can increase during market stress.

Metric	Value
Current (30-day)	0.11
Average (full period)	0.24
Minimum	-0.15
Maximum	0.54

Correlation measures how closely two assets move together. Values near +1 indicate strong co-movement, near 0 indicates independence, and negative values indicate inverse movement.

Investment Comparison

If you invested $10,000 in each asset on January 1, 2025:

BTC $9,128.825 -8.7%

XAG $25,788.023 +157.9%

Difference: $16,659.198 (XAG ahead)

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Bitcoin and Silver: Risk Analysis

Bitcoin experienced its maximum drawdown of -32.1% from 2025-10-06 to 2025-11-22. It has not yet recovered to its previous peak.

Silver experienced its maximum drawdown of -13.6% from 2025-03-27 to 2025-04-04. It has not yet recovered to its previous peak.

Smaller drawdowns and faster recoveries indicate lower downside risk and greater resilience during market stress.

Sharpe Ratio of BTC and XAG

BTC Sharpe Ratio

↓ -0.03

XAG Sharpe Ratio

↑ 2.78

Sharpe ratio measures return per unit of risk (volatility). A higher Sharpe indicates better risk-adjusted performance. BTC had a negative Sharpe (-0.03) while XAG was positive (2.78), indicating XAG had meaningfully better risk-adjusted performance in this period.

A Sharpe above 1.0 is generally considered good, above 2.0 is excellent. Negative Sharpe means the asset underperformed the risk-free rate. Calculated on each asset's full 365-day lookback of available prices and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).

Sortino Ratio of BTC and XAG

BTC Sortino Ratio

↓ -0.04

XAG Sortino Ratio

↑ 4.38

Sortino ratio measures return per unit of downside risk. Unlike Sharpe, it only counts downside deviation (returns below the target return). XAG had better downside-adjusted returns.

A higher Sortino is better. It's useful when upside volatility is common (crypto is the obvious example). Downside deviation: BTC 29.5% vs XAG 20.0%. Calculated on each asset's full 365-day lookback of available prices, using the daily risk-free rate as the target return, and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).

Calmar Ratio of BTC and XAG

BTC Calmar Ratio

↓ -0.17

XAG Calmar Ratio

↑ 10.54

Calmar ratio compares CAGR to maximum drawdown. Higher Calmar means more return per unit of worst drawdown. XAG posted the higher Calmar ratio.

Calmar is computed on each asset's full 365-day lookback and uses the max drawdown over that same window.

Sterling Ratio of BTC and XAG

BTC Sterling Ratio

↓ -0.40

XAG Sterling Ratio

↑ 10.32

Sterling ratio measures excess return per unit of average drawdown (typically drawdowns worse than 10%). XAG posted the higher Sterling ratio.

Sterling uses average drawdown events deeper than 10% and subtracts the risk-free rate to report excess return.

Treynor Ratio of BTC and XAG

BTC Treynor Ratio

↓ -0.05

XAG Treynor Ratio

↑ 2.19

Treynor ratio measures excess return per unit of market risk (beta) instead of total volatility. XAG posted the higher Treynor ratio.

Treynor uses beta vs the S&P 500 (SPY) on shared dates and the average 3-month Treasury rate as the risk-free rate.

Ulcer Index of BTC and XAG

BTC Ulcer Index

14.59%

XAG Ulcer Index

4.21%

Ulcer Index captures drawdown depth and duration. Lower Ulcer Index means less drawdown pain. XAG had the lower Ulcer Index (less drawdown pain).

Ulcer Index is computed from each asset's drawdown series over the full lookback window.

Tail Risk & Distribution Shape (2025): Bitcoin vs. Silver

This section looks at the shape of daily returns, not just the average. Tail stats are computed per asset on its own daily series (crypto includes weekends). We use daily log returns $\ln\left(\frac{P_t}{P_{t-1}}\right)$ so multi-day moves add cleanly.

Definitions: Value at Risk (VaR), Expected Shortfall, skew, kurtosis, and fat tails.

Metric (2025)	BTC	XAG
5% VaR (daily log return)	-3.65%	-2.32%
5% Expected Shortfall (CVaR)	-5.07% (worst 19 days)	-4.51% (worst 13 days)
Skew	-0.03	-0.41
Excess kurtosis	2.26	3.82
2σ tail days (down / up)	11 / 9	6 / 5
Worst day	-8.63% (2025-03-03)	-8.02% (2025-12-29)
Best day	+9.60% (2025-03-02)	+9.18% (2025-12-26)

Downside co-moves (2σ) — 2025

Computed on shared dates only (n=256). A “2σ downside move” means a shared-close log return more than 2 standard deviations below that asset’s own mean on this shared-date series. Dates below show simple returns (%) for readability.

When XAG has a big down day, BTC also does

0.0%

0 / 5 days

When BTC has a big down day, XAG also does

0.0%

0 / 10 days

Show downside tail dates

Dates below are shared-date observations. The “Date” is the period end (close). Tail thresholds are computed on log returns, but the table shows simple returns (%) for readability. Returns are computed from the previous shared close to this one (for example, Friday → Monday includes weekend moves).

Days when both BTC and XAG had a big down day (2σ)

None in this window.

Days when BTC had a big down day

Date (interval)	BTC	XAG
2025-01-07	-5.16%	+0.34%
2025-02-21 → 2025-02-24	-4.93%	-0.56%
2025-02-26	-5.47%	+0.33%
2025-03-07 → 2025-03-10	-9.21%	-1.37%
2025-04-04 → 2025-04-07	-5.57%	+1.16%
2025-08-22 → 2025-08-25	-5.69%	-0.91%
2025-10-10	-6.98%	+1.68%
2025-11-14	-5.29%	-3.09%
2025-11-20	-5.16%	-1.37%
2025-11-28 → 2025-12-01	-5.13%	+2.82%

Days when XAG had a big down day

Date (interval)	BTC	XAG
2025-04-03	+0.77%	-5.99%
2025-04-04	+0.83%	-6.64%
2025-10-17	-1.51%	-4.40%
2025-10-21	-1.92%	-7.10%
2025-12-26 → 2025-12-29	-0.17%	-8.02%

Read this as “how ugly the ugly days get”, not as a precise forecast. One-year samples are small, so tail estimates are inherently noisy.

Full Comparison of Bitcoin vs. Silver (2025)

Metric	BTC	XAG
Total Return	-8.7%	+157.9%
Annualized Volatility	41.9%	31.6%
Sharpe Ratio	-0.03	2.78
Sortino Ratio	-0.04	4.38
Calmar Ratio	-0.17	10.54
Sterling Ratio	-0.40	10.32
Treynor Ratio	-0.05	2.19
Ulcer Index	14.59%	4.21%
Max Drawdown	-32.1%	-13.6%
Avg Correlation to S&P 500	N/A	N/A
5% VaR (daily log return)	-3.65%	-2.32%
5% Expected Shortfall (CVaR)	-5.07%	-4.51%
Skew	-0.03	-0.41
Excess kurtosis	2.26	3.82
2σ tail days (down / up)	11 / 9	6 / 5

Audit this calculation

Formulas, inputs, and conventions used to compute the metrics on this page.

Inputs & conventions

Shared window for pair metrics: 2025-01-02 → 2025-12-30 (last shared close).
Rolling correlation sample (shared closes): 227 rolling 30-day values (from 256 shared daily returns).
Annualization (days/year): BTC: 365 days/year; XAG: 252 days/year.
Risk-free rate: Uses the 3-month U.S. Treasury yield (FRED: DGS3MO), averaged over each asset’s window:

BTC: 4.22% over 2024-12-31 → 2025-12-30.

XAG: 4.22% over 2025-01-02 → 2025-12-31.
Volatility drag (rule of thumb): Estimated from annualized volatility (simple returns). For the log-return framing, see Log returns.

BTC: ≈ -8.8%/yr

XAG: ≈ -5.0%/yr
Data alignment: No forward fill. Correlation and tail co-moves are computed on shared closes only.
For cross-calendar pairs (e.g., crypto vs stocks), weekend/holiday moves roll into the next shared close.
Return conventions: Volatility/Sharpe/Sortino use simple daily returns. Tail-risk uses daily log returns for distribution stats (but tables show simple returns). Log returns.

Formulas

Daily simple return

r_t = \frac{P_t}{P_{t-1}} - 1

Volatility

\sigma_{ann} = \sigma(r_t)\sqrt{A}

Volatility drag (approx.)

\text{drag} \approx \tfrac{1}{2}\sigma_{ann}^2

Sharpe Ratio

S = \frac{A\,\bar{r} - r_f}{\sigma(r_t)\sqrt{A}}

Sortino Ratio

So = \frac{A\,\bar{r} - r_f}{\sqrt{\mathbb{E}[\min(0,\,r_t - r_f/A)^2]}\,\sqrt{A}}

Maximum Drawdown

MDD = \min_t\left(\frac{P_t}{\max_{s \le t} P_s} - 1\right)

Average Correlation

\rho = \frac{\operatorname{cov}(r^A,\,r^B)}{\sigma_A\,\sigma_B}

Log returns

\ell_t = \ln\left(\frac{P_t}{P_{t-1}}\right)

Notation

$P_t$: Price on day t.
$r_t$: Simple daily return.
$\ell_t$: Log daily return.
$\bar{r}$: Average daily return.
$\sigma(r_t)$: Standard deviation of daily returns.
$A$: Annualization factor (days/year).
$r_f$: Annual risk-free rate.

Bitcoin vs Silver: Frequently Asked Questions

Which had higher volatility: BTC or XAG?

BTC showed higher volatility at 41.9% annualized, compared to 31.6% for XAG During 2025. Higher volatility meant larger price swings in both directions.

Did BTC provide diversification when held with XAG?

BTC and XAG were weakly correlated in 2025, with an average correlation of 0.24. This weak correlation suggested meaningful diversification benefits when held together.

How bad are the worst 5% days for BTC vs XAG?

During 2025, BTC's 5% VaR was -3.65% and its 5% Expected Shortfall was -5.07% (worst 19 days). XAG's were -2.32% and -4.51% (worst 13 days).

Do BTC and XAG crash together on bad days?

On shared dates (n=256), when XAG has a 2σ down day, BTC also does 0.0% (0/5 days). In the other direction, when BTC has one, XAG also does 0.0% (0/10 days).

Which had better risk-adjusted returns: BTC or XAG?

BTC had a negative Sharpe (-0.03) while XAG was positive (2.78) During 2025, indicating XAG had meaningfully better risk-adjusted performance.

Could BTC and XAG have been combined in a portfolio?

Yes, though allocation sizing mattered. Their weak correlation could have meaningfully reduced overall portfolio variance. BTC's higher volatility (41.9%) meant even small allocations can materially impact overall portfolio risk.