Correlation Between Bitfarms and Catalystmillburn

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

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

Diversification Opportunities for Bitfarms and Catalystmillburn

0.24

Correlation Coefficient

Bitfarms  Catalystmillburn

Modest diversification

The 3 months correlation between Bitfarms and Catalystmillburn is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Bitfarms and Catalystmillburn Hedge Strateg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystmillburn Hedge and Bitfarms 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 Bitfarms are associated (or correlated) with Catalystmillburn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystmillburn Hedge has no effect on the direction of Bitfarms i.e., Bitfarms and Catalystmillburn go up and down completely randomly.

Pair Corralation between Bitfarms and Catalystmillburn

Given the investment horizon of 90 days Bitfarms is expected to generate 9.45 times more return on investment than Catalystmillburn. However, Bitfarms is 9.45 times more volatile than Catalystmillburn Hedge Strategy. It trades about 0.08 of its potential returns per unit of risk. Catalystmillburn Hedge Strategy is currently generating about 0.14 per unit of risk. If you would invest  97.00  in Bitfarms on May 4, 2025 and sell it today you would earn a total of  19.00  from holding Bitfarms or generate 19.59% return on investment over 90 days.

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

Bitfarms  vs.  Catalystmillburn Hedge Strateg

Bitfarms

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Bitfarms are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Bitfarms reported solid returns over the last few months and may actually be approaching a breakup point.

Catalystmillburn Hedge

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Catalystmillburn Hedge Strategy are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Catalystmillburn is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Bitfarms and Catalystmillburn

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

The idea behind Bitfarms and Catalystmillburn Hedge Strategy 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.