Correlation Between Marathon Digital and Naas Technology
Can any of the company-specific risk be diversified away by investing in both Marathon Digital and Naas 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 Marathon Digital and Naas Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marathon Digital Holdings and Naas Technology ADR, you can compare the effects of market volatilities on Marathon Digital and Naas 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 Marathon Digital with a short position of Naas Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marathon Digital and Naas Technology.
Diversification Opportunities for Marathon Digital and Naas Technology
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Marathon and Naas is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Marathon Digital Holdings and Naas Technology ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naas Technology ADR and Marathon Digital 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 Marathon Digital Holdings are associated (or correlated) with Naas Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naas Technology ADR has no effect on the direction of Marathon Digital i.e., Marathon Digital and Naas Technology go up and down completely randomly.
Pair Corralation between Marathon Digital and Naas Technology
Given the investment horizon of 90 days Marathon Digital Holdings is expected to generate 1.12 times more return on investment than Naas Technology. However, Marathon Digital is 1.12 times more volatile than Naas Technology ADR. It trades about 0.05 of its potential returns per unit of risk. Naas Technology ADR is currently generating about -0.1 per unit of risk. If you would invest 1,316 in Marathon Digital Holdings on January 24, 2024 and sell it today you would earn a total of 439.00 from holding Marathon Digital Holdings or generate 33.36% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Marathon Digital Holdings vs. Naas Technology ADR
Performance |
Timeline |
Marathon Digital Holdings |
Naas Technology ADR |
Marathon Digital and Naas Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Marathon Digital and Naas Technology
The main advantage of trading using opposite Marathon Digital and Naas Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marathon Digital position performs unexpectedly, Naas 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 Naas Technology will offset losses from the drop in Naas Technology's long position.Marathon Digital vs. Hut 8 Corp | Marathon Digital vs. HIVE Blockchain Technologies | Marathon Digital vs. Terawulf | Marathon Digital vs. Bitfarms |
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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