Correlation Between ICOA and Marathon Digital
Can any of the company-specific risk be diversified away by investing in both ICOA and Marathon 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 ICOA and Marathon Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICOA Inc and Marathon Digital Holdings, you can compare the effects of market volatilities on ICOA and Marathon 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 ICOA with a short position of Marathon Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICOA and Marathon Digital.
Diversification Opportunities for ICOA and Marathon Digital
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ICOA and Marathon is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding ICOA Inc and Marathon Digital Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marathon Digital Holdings and ICOA 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 ICOA Inc are associated (or correlated) with Marathon Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marathon Digital Holdings has no effect on the direction of ICOA i.e., ICOA and Marathon Digital go up and down completely randomly.
Pair Corralation between ICOA and Marathon Digital
If you would invest 0.01 in ICOA Inc on November 28, 2024 and sell it today you would earn a total of 0.00 from holding ICOA Inc or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICOA Inc vs. Marathon Digital Holdings
Performance |
| Timeline |
| ICOA Inc |
| Marathon Digital Holdings |
ICOA and Marathon Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICOA and Marathon Digital
The main advantage of trading using opposite ICOA and Marathon Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICOA position performs unexpectedly, Marathon 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 Marathon Digital will offset losses from the drop in Marathon Digital's long position.The idea behind ICOA Inc and Marathon Digital Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Marathon Digital vs. Hut 8 Corp | Marathon Digital vs. CleanSpark | Marathon Digital vs. Bit Digital | Marathon Digital vs. Bitfarms |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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