Correlation Between MGT Capital and Mawson Infrastructure
Can any of the company-specific risk be diversified away by investing in both MGT Capital and Mawson Infrastructure 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 MGT Capital and Mawson Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MGT Capital Investments and Mawson Infrastructure Group, you can compare the effects of market volatilities on MGT Capital and Mawson Infrastructure 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 MGT Capital with a short position of Mawson Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGT Capital and Mawson Infrastructure.
Diversification Opportunities for MGT Capital and Mawson Infrastructure
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between MGT and Mawson is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding MGT Capital Investments and Mawson Infrastructure Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mawson Infrastructure and MGT 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 MGT Capital Investments are associated (or correlated) with Mawson Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mawson Infrastructure has no effect on the direction of MGT Capital i.e., MGT Capital and Mawson Infrastructure go up and down completely randomly.
Pair Corralation between MGT Capital and Mawson Infrastructure
If you would invest 162.00 in Mawson Infrastructure Group on August 26, 2024 and sell it today you would earn a total of 17.00 from holding Mawson Infrastructure Group or generate 10.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
MGT Capital Investments vs. Mawson Infrastructure Group
Performance |
| Timeline |
| MGT Capital Investments |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Mawson Infrastructure |
MGT Capital and Mawson Infrastructure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MGT Capital and Mawson Infrastructure
The main advantage of trading using opposite MGT Capital and Mawson Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGT Capital position performs unexpectedly, Mawson Infrastructure 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 Mawson Infrastructure will offset losses from the drop in Mawson Infrastructure's long position.The idea behind MGT Capital Investments and Mawson Infrastructure Group 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.| Mawson Infrastructure vs. Terawulf | Mawson Infrastructure vs. Iris Energy | Mawson Infrastructure vs. Stronghold Digital Mining | Mawson Infrastructure vs. Argo Blockchain PLC |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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