Correlation Between Mawson Infrastructure and Bitmine Immersion

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

By analyzing existing cross correlation between Mawson Infrastructure Group and Bitmine Immersion Technologies, you can compare the effects of market volatilities on Mawson Infrastructure and Bitmine Immersion 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 Mawson Infrastructure with a short position of Bitmine Immersion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mawson Infrastructure and Bitmine Immersion.

Diversification Opportunities for Mawson Infrastructure and Bitmine Immersion

-0.36

Correlation Coefficient

Mawson Infrastructure  Bitmine Immersion

Very good diversification

The 3 months correlation between Mawson and Bitmine is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Mawson Infrastructure Group and Bitmine Immersion Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitmine Immersion and Mawson Infrastructure 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 Mawson Infrastructure Group are associated (or correlated) with Bitmine Immersion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitmine Immersion has no effect on the direction of Mawson Infrastructure i.e., Mawson Infrastructure and Bitmine Immersion go up and down completely randomly.

Pair Corralation between Mawson Infrastructure and Bitmine Immersion

Given the investment horizon of 90 days Mawson Infrastructure is expected to generate 2.33 times less return on investment than Bitmine Immersion. But when comparing it to its historical volatility, Mawson Infrastructure Group is 1.52 times less risky than Bitmine Immersion. It trades about 0.05 of its potential returns per unit of risk. Bitmine Immersion Technologies is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  71.00  in Bitmine Immersion Technologies on September 17, 2024 and sell it today you would lose (26.00) from holding Bitmine Immersion Technologies or give up 36.62% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Mawson Infrastructure Group  vs.  Bitmine Immersion Technologies

Mawson Infrastructure

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mawson Infrastructure Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile technical and fundamental indicators, Mawson Infrastructure demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Bitmine Immersion

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bitmine Immersion Technologies are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Bitmine Immersion reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Mawson Infrastructure and Bitmine Immersion

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

The idea behind Mawson Infrastructure Group and Bitmine Immersion Technologies 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.