Correlation Between Greenidge Generation and CleanSpark

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

By analyzing existing cross correlation between Greenidge Generation Holdings and CleanSpark, you can compare the effects of market volatilities on Greenidge Generation and CleanSpark 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 Greenidge Generation with a short position of CleanSpark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenidge Generation and CleanSpark.

Diversification Opportunities for Greenidge Generation and CleanSpark

0.76

Correlation Coefficient

Greenidge Generation  CleanSpark

Poor diversification

The 3 months correlation between Greenidge and CleanSpark is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Greenidge Generation Holdings and CleanSpark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CleanSpark and Greenidge Generation 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 Greenidge Generation Holdings are associated (or correlated) with CleanSpark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CleanSpark has no effect on the direction of Greenidge Generation i.e., Greenidge Generation and CleanSpark go up and down completely randomly.

Pair Corralation between Greenidge Generation and CleanSpark

Given the investment horizon of 90 days Greenidge Generation Holdings is expected to generate 0.7 times more return on investment than CleanSpark. However, Greenidge Generation Holdings is 1.42 times less risky than CleanSpark. It trades about -0.09 of its potential returns per unit of risk. CleanSpark is currently generating about -0.08 per unit of risk. If you would invest  212.00  in Greenidge Generation Holdings on September 22, 2024 and sell it today you would lose (22.00) from holding Greenidge Generation Holdings or give up 10.38% of portfolio value over 90 days.

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

Greenidge Generation Holdings  vs.  CleanSpark

Greenidge Generation

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Greenidge Generation Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Greenidge Generation exhibited solid returns over the last few months and may actually be approaching a breakup point.

CleanSpark

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CleanSpark are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent basic indicators, CleanSpark disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Greenidge Generation and CleanSpark

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

The idea behind Greenidge Generation Holdings and CleanSpark 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.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.