Correlation Between Bitfarms and Financial
Can any of the company-specific risk be diversified away by investing in both Bitfarms and Financial 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 Bitfarms and Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bitfarms and Financial 15 Split, you can compare the effects of market volatilities on Bitfarms and Financial 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 Bitfarms with a short position of Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bitfarms and Financial.
Diversification Opportunities for Bitfarms and Financial
Very weak diversification
The 3 months correlation between Bitfarms and Financial is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Bitfarms and Financial 15 Split in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Financial 15 Split and Bitfarms 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 Bitfarms are associated (or correlated) with Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Financial 15 Split has no effect on the direction of Bitfarms i.e., Bitfarms and Financial go up and down completely randomly.
Pair Corralation between Bitfarms and Financial
Assuming the 90 days trading horizon Bitfarms is expected to generate 22.81 times more return on investment than Financial. However, Bitfarms is 22.81 times more volatile than Financial 15 Split. It trades about 0.08 of its potential returns per unit of risk. Financial 15 Split is currently generating about 0.25 per unit of risk. If you would invest 245.00 in Bitfarms on September 6, 2024 and sell it today you would earn a total of 56.00 from holding Bitfarms or generate 22.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Bitfarms vs. Financial 15 Split
Performance |
Timeline |
Bitfarms |
Financial 15 Split |
Bitfarms and Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bitfarms and Financial
The main advantage of trading using opposite Bitfarms and Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bitfarms position performs unexpectedly, Financial 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 Financial will offset losses from the drop in Financial's long position.Bitfarms vs. Hut 8 Mining | Bitfarms vs. Bitfarms | Bitfarms vs. Dmg Blockchain Solutions | Bitfarms vs. Galaxy Digital Holdings |
Financial vs. North American Financial | Financial vs. Dividend 15 Split | Financial vs. Dividend Growth Split | Financial vs. Dividend 15 Split |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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