Correlation Between CleanSpark and Cipher Mining

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

By analyzing existing cross correlation between CleanSpark and Cipher Mining, you can compare the effects of market volatilities on CleanSpark and Cipher Mining 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 Cipher Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of CleanSpark and Cipher Mining.

Diversification Opportunities for CleanSpark and Cipher Mining

0.81

Correlation Coefficient

CleanSpark  Cipher Mining

Very poor diversification

The 3 months correlation between CleanSpark and Cipher is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding CleanSpark and Cipher Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cipher Mining 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 Cipher Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cipher Mining has no effect on the direction of CleanSpark i.e., CleanSpark and Cipher Mining go up and down completely randomly.

Pair Corralation between CleanSpark and Cipher Mining

Given the investment horizon of 90 days CleanSpark is expected to generate 1.22 times less return on investment than Cipher Mining. But when comparing it to its historical volatility, CleanSpark is 1.15 times less risky than Cipher Mining. It trades about 0.08 of its potential returns per unit of risk. Cipher Mining is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  308.00  in Cipher Mining on March 10, 2025 and sell it today you would earn a total of  82.00  from holding Cipher Mining or generate 26.62% return on investment over 90 days.

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

CleanSpark  vs.  Cipher Mining

CleanSpark

Risk-Adjusted Performance

Modest

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

Cipher Mining

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cipher Mining are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating technical and fundamental indicators, Cipher Mining reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CleanSpark and Cipher Mining

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

The idea behind CleanSpark and Cipher Mining 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.

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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.