Correlation Between Marathon Digital and Grayscale Bitcoin
Can any of the company-specific risk be diversified away by investing in both Marathon Digital and Grayscale Bitcoin 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 Marathon Digital and Grayscale Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marathon Digital Holdings and Grayscale Bitcoin Trust, you can compare the effects of market volatilities on Marathon Digital and Grayscale Bitcoin 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 Marathon Digital with a short position of Grayscale Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marathon Digital and Grayscale Bitcoin.
Diversification Opportunities for Marathon Digital and Grayscale Bitcoin
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Marathon and Grayscale is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Marathon Digital Holdings and Grayscale Bitcoin Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Bitcoin Trust and Marathon Digital 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 Marathon Digital Holdings are associated (or correlated) with Grayscale Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Bitcoin Trust has no effect on the direction of Marathon Digital i.e., Marathon Digital and Grayscale Bitcoin go up and down completely randomly.
Pair Corralation between Marathon Digital and Grayscale Bitcoin
Given the investment horizon of 90 days Marathon Digital Holdings is expected to under-perform the Grayscale Bitcoin. In addition to that, Marathon Digital is 1.64 times more volatile than Grayscale Bitcoin Trust. It trades about -0.26 of its total potential returns per unit of risk. Grayscale Bitcoin Trust is currently generating about -0.2 per unit of volatility. If you would invest 8,305 in Grayscale Bitcoin Trust on November 18, 2024 and sell it today you would lose (604.00) from holding Grayscale Bitcoin Trust or give up 7.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marathon Digital Holdings vs. Grayscale Bitcoin Trust
Performance |
| Timeline |
| Marathon Digital Holdings |
| Grayscale Bitcoin Trust |
Marathon Digital and Grayscale Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marathon Digital and Grayscale Bitcoin
The main advantage of trading using opposite Marathon Digital and Grayscale Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marathon Digital position performs unexpectedly, Grayscale Bitcoin 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 Grayscale Bitcoin will offset losses from the drop in Grayscale Bitcoin's long position.| Marathon Digital vs. Hut 8 Corp | Marathon Digital vs. CleanSpark | Marathon Digital vs. Bit Digital | Marathon Digital vs. Bitfarms |
| Grayscale Bitcoin vs. Grayscale Ethereum Trust | Grayscale Bitcoin vs. Riot Blockchain | Grayscale Bitcoin vs. Marathon Digital Holdings | Grayscale Bitcoin vs. Coinbase Global |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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