Correlation Between Stronghold Digital and BIG Blockchain
Can any of the company-specific risk be diversified away by investing in both Stronghold Digital and BIG Blockchain 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 Stronghold Digital and BIG Blockchain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stronghold Digital Mining and BIG Blockchain Intelligence, you can compare the effects of market volatilities on Stronghold Digital and BIG Blockchain 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 Stronghold Digital with a short position of BIG Blockchain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stronghold Digital and BIG Blockchain.
Diversification Opportunities for Stronghold Digital and BIG Blockchain
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Stronghold and BIG is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Stronghold Digital Mining and BIG Blockchain Intelligence in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BIG Blockchain Intel and Stronghold 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 Stronghold Digital Mining are associated (or correlated) with BIG Blockchain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BIG Blockchain Intel has no effect on the direction of Stronghold Digital i.e., Stronghold Digital and BIG Blockchain go up and down completely randomly.
Pair Corralation between Stronghold Digital and BIG Blockchain
Given the investment horizon of 90 days Stronghold Digital Mining is expected to generate 1.49 times more return on investment than BIG Blockchain. However, Stronghold Digital is 1.49 times more volatile than BIG Blockchain Intelligence. It trades about 0.09 of its potential returns per unit of risk. BIG Blockchain Intelligence is currently generating about 0.03 per unit of risk. If you would invest 284.00 in Stronghold Digital Mining on September 1, 2024 and sell it today you would earn a total of 236.00 from holding Stronghold Digital Mining or generate 83.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stronghold Digital Mining vs. BIG Blockchain Intelligence
Performance |
| Timeline |
| Stronghold Digital Mining |
| BIG Blockchain Intel |
Stronghold Digital and BIG Blockchain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stronghold Digital and BIG Blockchain
The main advantage of trading using opposite Stronghold Digital and BIG Blockchain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stronghold Digital position performs unexpectedly, BIG Blockchain 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 BIG Blockchain will offset losses from the drop in BIG Blockchain's long position.| Stronghold Digital vs. Terawulf | Stronghold Digital vs. Iris Energy | Stronghold Digital vs. Argo Blockchain PLC | Stronghold Digital vs. Bitfarms |
| BIG Blockchain vs. DeFi Technologies | BIG Blockchain vs. Argo Blockchain PLC | BIG Blockchain vs. DigiMax Global | BIG Blockchain vs. Galaxy Digital Holdings |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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