Correlation Between Digihost Technology and Galaxy Digital
Can any of the company-specific risk be diversified away by investing in both Digihost Technology and Galaxy Digital 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 Digihost Technology and Galaxy Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digihost Technology and Galaxy Digital Holdings, you can compare the effects of market volatilities on Digihost Technology and Galaxy Digital 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 Digihost Technology with a short position of Galaxy Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digihost Technology and Galaxy Digital.
Diversification Opportunities for Digihost Technology and Galaxy Digital
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Digihost and Galaxy is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Digihost Technology and Galaxy Digital Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galaxy Digital Holdings and Digihost Technology 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 Digihost Technology are associated (or correlated) with Galaxy Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galaxy Digital Holdings has no effect on the direction of Digihost Technology i.e., Digihost Technology and Galaxy Digital go up and down completely randomly.
Pair Corralation between Digihost Technology and Galaxy Digital
Assuming the 90 days trading horizon Digihost Technology is expected to generate 1.02 times more return on investment than Galaxy Digital. However, Digihost Technology is 1.02 times more volatile than Galaxy Digital Holdings. It trades about 0.26 of its potential returns per unit of risk. Galaxy Digital Holdings is currently generating about 0.19 per unit of risk. If you would invest 195.00 in Digihost Technology on August 25, 2024 and sell it today you would earn a total of 91.00 from holding Digihost Technology or generate 46.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digihost Technology vs. Galaxy Digital Holdings
Performance |
| Timeline |
| Digihost Technology |
| Galaxy Digital Holdings |
Digihost Technology and Galaxy Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digihost Technology and Galaxy Digital
The main advantage of trading using opposite Digihost Technology and Galaxy Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digihost Technology position performs unexpectedly, Galaxy Digital 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 Galaxy Digital will offset losses from the drop in Galaxy Digital's long position.| Digihost Technology vs. Neptune Digital Assets | Digihost Technology vs. Dmg Blockchain Solutions | Digihost Technology vs. CryptoStar Corp |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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