Correlation Between BitFrontier Capital and Bitfarms
Can any of the company-specific risk be diversified away by investing in both BitFrontier Capital and Bitfarms at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining BitFrontier Capital and Bitfarms into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BitFrontier Capital Holdings and Bitfarms, you can compare the effects of market volatilities on BitFrontier Capital and Bitfarms and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in BitFrontier Capital with a short position of Bitfarms. Check out your portfolio center. Please also check ongoing floating volatility patterns of BitFrontier Capital and Bitfarms.
Diversification Opportunities for BitFrontier Capital and Bitfarms
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BitFrontier and Bitfarms is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding BitFrontier Capital Holdings and Bitfarms in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitfarms and BitFrontier Capital is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on BitFrontier Capital Holdings are associated (or correlated) with Bitfarms. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitfarms has no effect on the direction of BitFrontier Capital i.e., BitFrontier Capital and Bitfarms go up and down completely randomly.
Pair Corralation between BitFrontier Capital and Bitfarms
Given the investment horizon of 90 days BitFrontier Capital is expected to generate 1.35 times less return on investment than Bitfarms. In addition to that, BitFrontier Capital is 1.81 times more volatile than Bitfarms. It trades about 0.03 of its total potential returns per unit of risk. Bitfarms is currently generating about 0.08 per unit of volatility. If you would invest 49.00 in Bitfarms on August 30, 2024 and sell it today you would earn a total of 166.00 from holding Bitfarms or generate 338.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
BitFrontier Capital Holdings vs. Bitfarms
Performance |
| Timeline |
| BitFrontier Capital |
| Bitfarms |
BitFrontier Capital and Bitfarms Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BitFrontier Capital and Bitfarms
The main advantage of trading using opposite BitFrontier Capital and Bitfarms positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BitFrontier Capital position performs unexpectedly, Bitfarms can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Bitfarms will offset losses from the drop in Bitfarms' long position.| BitFrontier Capital vs. XTRA Bitcoin | BitFrontier Capital vs. Coin Citadel | BitFrontier Capital vs. Dmg Blockchain Solutions | BitFrontier Capital vs. Argo Blockchain PLC |
| Bitfarms vs. HIVE Blockchain Technologies | Bitfarms vs. CleanSpark | Bitfarms vs. Marathon Digital Holdings | Bitfarms vs. Riot Blockchain |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bonds Directory module to find actively traded corporate debentures issued by US companies.
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