Correlation Between HIVE Blockchain and Galaxy Digital

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

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

Diversification Opportunities for HIVE Blockchain and Galaxy Digital

0.33

Correlation Coefficient

HIVE Blockchain  Galaxy Digital

Weak diversification

The 3 months correlation between HIVE and Galaxy is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding HIVE Blockchain Technologies 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 HIVE 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 HIVE Blockchain Technologies 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 HIVE Blockchain i.e., HIVE Blockchain and Galaxy Digital go up and down completely randomly.

Pair Corralation between HIVE Blockchain and Galaxy Digital

Given the investment horizon of 90 days HIVE Blockchain is expected to generate 2.74 times less return on investment than Galaxy Digital. In addition to that, HIVE Blockchain is 1.07 times more volatile than Galaxy Digital Holdings. It trades about 0.03 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  383.00  in Galaxy Digital Holdings on October 10, 2024 and sell it today you would earn a total of  1,584  from holding Galaxy Digital Holdings or generate 413.58% return on investment over 90 days.

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

HIVE Blockchain Technologies  vs.  Galaxy Digital Holdings

HIVE Blockchain Tech

Risk-Adjusted Performance

3 of 100

Insignificant

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

Galaxy Digital Holdings

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Galaxy Digital Holdings are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical indicators, Galaxy Digital reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HIVE Blockchain and Galaxy Digital

The main advantage of trading using opposite HIVE Blockchain and Galaxy Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HIVE Blockchain 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.

The idea behind HIVE Blockchain Technologies and Galaxy Digital Holdings 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.