Correlation Between CleanSpark and Netcapital
Can any of the company-specific risk be diversified away by investing in both CleanSpark and Netcapital 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 CleanSpark and Netcapital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CleanSpark and Netcapital, you can compare the effects of market volatilities on CleanSpark and Netcapital 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 CleanSpark with a short position of Netcapital. Check out your portfolio center. Please also check ongoing floating volatility patterns of CleanSpark and Netcapital.
Diversification Opportunities for CleanSpark and Netcapital
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CleanSpark and Netcapital is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding CleanSpark and Netcapital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netcapital and CleanSpark 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 CleanSpark are associated (or correlated) with Netcapital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netcapital has no effect on the direction of CleanSpark i.e., CleanSpark and Netcapital go up and down completely randomly.
Pair Corralation between CleanSpark and Netcapital
Given the investment horizon of 90 days CleanSpark is expected to under-perform the Netcapital. In addition to that, CleanSpark is 1.13 times more volatile than Netcapital. It trades about -0.11 of its total potential returns per unit of risk. Netcapital is currently generating about -0.04 per unit of volatility. If you would invest 14.00 in Netcapital on February 1, 2024 and sell it today you would lose (1.00) from holding Netcapital or give up 7.14% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
CleanSpark vs. Netcapital
Performance |
Timeline |
CleanSpark |
Netcapital |
CleanSpark and Netcapital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CleanSpark and Netcapital
The main advantage of trading using opposite CleanSpark and Netcapital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CleanSpark position performs unexpectedly, Netcapital 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 Netcapital will offset losses from the drop in Netcapital's long position.CleanSpark vs. Hut 8 Corp | CleanSpark vs. HIVE Blockchain Technologies | CleanSpark vs. Bit Digital | CleanSpark vs. Terawulf |
Netcapital vs. HIVE Blockchain Technologies | Netcapital vs. CleanSpark | Netcapital vs. Bit Digital | Netcapital vs. Terawulf |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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