Correlation Between Forge Global and Digihost Technology
Can any of the company-specific risk be diversified away by investing in both Forge Global and Digihost Technology 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 Forge Global and Digihost Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forge Global Holdings and Digihost Technology, you can compare the effects of market volatilities on Forge Global and Digihost Technology 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 Forge Global with a short position of Digihost Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forge Global and Digihost Technology.
Diversification Opportunities for Forge Global and Digihost Technology
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Forge and Digihost is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Forge Global Holdings and Digihost Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digihost Technology and Forge Global 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 Forge Global Holdings are associated (or correlated) with Digihost Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digihost Technology has no effect on the direction of Forge Global i.e., Forge Global and Digihost Technology go up and down completely randomly.
Pair Corralation between Forge Global and Digihost Technology
Given the investment horizon of 90 days Forge Global is expected to generate 3.78 times less return on investment than Digihost Technology. In addition to that, Forge Global is 2.28 times more volatile than Digihost Technology. It trades about 0.07 of its total potential returns per unit of risk. Digihost Technology is currently generating about 0.58 per unit of volatility. If you would invest 123.00 in Digihost Technology on January 13, 2025 and sell it today you would earn a total of 9.00 from holding Digihost Technology or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 13.64% |
| Values | Daily Returns |
Forge Global Holdings vs. Digihost Technology
Performance |
| Timeline |
| Forge Global Holdings |
| Digihost Technology |
Risk-Adjusted Performance
Weak
Weak | Strong |
Forge Global and Digihost Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forge Global and Digihost Technology
The main advantage of trading using opposite Forge Global and Digihost Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forge Global position performs unexpectedly, Digihost Technology 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 Digihost Technology will offset losses from the drop in Digihost Technology's long position.| Forge Global vs. Clearwater Analytics Holdings | Forge Global vs. Expensify | Forge Global vs. CS Disco LLC | Forge Global vs. Amplitude |
| Digihost Technology vs. DatChat | Digihost Technology vs. Marin Software | Digihost Technology vs. Freight Technologies | Digihost Technology vs. Auddia Inc |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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