Correlation Between Stronghold Digital and Galaxy Digital
Can any of the company-specific risk be diversified away by investing in both Stronghold Digital and Galaxy 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 Stronghold Digital and Galaxy Digital 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 Galaxy Digital Holdings, you can compare the effects of market volatilities on Stronghold Digital and Galaxy 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 Stronghold Digital with a short position of Galaxy Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stronghold Digital and Galaxy Digital.
Diversification Opportunities for Stronghold Digital and Galaxy Digital
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Stronghold and Galaxy is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Stronghold Digital Mining and Galaxy Digital Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galaxy Digital Holdings 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 Galaxy Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galaxy Digital Holdings has no effect on the direction of Stronghold Digital i.e., Stronghold Digital and Galaxy Digital go up and down completely randomly.
Pair Corralation between Stronghold Digital and Galaxy Digital
Given the investment horizon of 90 days Stronghold Digital is expected to generate 1.44 times less return on investment than Galaxy Digital. In addition to that, Stronghold Digital is 1.65 times more volatile than Galaxy Digital Holdings. It trades about 0.04 of its total potential returns per unit of risk. Galaxy Digital Holdings is currently generating about 0.09 per unit of volatility. If you would invest 304.00 in Galaxy Digital Holdings on August 30, 2024 and sell it today you would earn a total of 1,478 from holding Galaxy Digital Holdings or generate 486.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Stronghold Digital Mining vs. Galaxy Digital Holdings
Performance |
| Timeline |
| Stronghold Digital Mining |
| Galaxy Digital Holdings |
Stronghold Digital and Galaxy Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stronghold Digital and Galaxy Digital
The main advantage of trading using opposite Stronghold Digital and Galaxy Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stronghold Digital position performs unexpectedly, Galaxy 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 Galaxy Digital will offset losses from the drop in Galaxy Digital's long position.| Stronghold Digital vs. Terawulf | Stronghold Digital vs. Iris Energy | Stronghold Digital vs. Argo Blockchain PLC | Stronghold Digital vs. Bitfarms |
| Galaxy Digital vs. SPENN Technology AS | Galaxy Digital vs. OFX Group Ltd | Galaxy Digital vs. Cypherpunk Holdings | Galaxy Digital vs. Cathedra Bitcoin |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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