Correlation Between Dmg Blockchain and Digihost Technology

Can any of the company-specific risk be diversified away by investing in both Dmg Blockchain and Digihost Technology 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 Dmg Blockchain and Digihost Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dmg Blockchain Solutions and Digihost Technology, you can compare the effects of market volatilities on Dmg Blockchain and Digihost Technology 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 Dmg Blockchain with a short position of Digihost Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dmg Blockchain and Digihost Technology.

Diversification Opportunities for Dmg Blockchain and Digihost Technology

0.13

Correlation Coefficient

Dmg Blockchain  Digihost Technology

Average diversification

The 3 months correlation between Dmg and Digihost is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Dmg Blockchain Solutions and Digihost Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digihost Technology and Dmg Blockchain 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 Dmg Blockchain Solutions are associated (or correlated) with Digihost Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digihost Technology has no effect on the direction of Dmg Blockchain i.e., Dmg Blockchain and Digihost Technology go up and down completely randomly.

Pair Corralation between Dmg Blockchain and Digihost Technology

Assuming the 90 days trading horizon Dmg Blockchain is expected to generate 7.26 times less return on investment than Digihost Technology. In addition to that, Dmg Blockchain is 1.07 times more volatile than Digihost Technology. It trades about 0.02 of its total potential returns per unit of risk. Digihost Technology is currently generating about 0.19 per unit of volatility. If you would invest  157.00  in Digihost Technology on September 3, 2024 and sell it today you would earn a total of  129.00  from holding Digihost Technology or generate 82.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Dmg Blockchain Solutions  vs.  Digihost Technology

Dmg Blockchain Solutions

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Dmg Blockchain Solutions are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal technical and fundamental indicators, Dmg Blockchain may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Digihost Technology

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Digihost Technology are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal technical indicators, Digihost Technology showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dmg Blockchain and Digihost Technology

The main advantage of trading using opposite Dmg Blockchain and Digihost Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dmg Blockchain position performs unexpectedly, Digihost Technology 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 Digihost Technology will offset losses from the drop in Digihost Technology's long position.

The idea behind Dmg Blockchain Solutions and Digihost Technology 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.

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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.