Correlation Between Capital One and Cipher Mining

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

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

Diversification Opportunities for Capital One and Cipher Mining

-0.03

Correlation Coefficient

Capital One  Cipher Mining

Good diversification

The 3 months correlation between Capital and Cipher is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Capital One Financial and Cipher Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cipher Mining and Capital One 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 Capital One Financial 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 Capital One i.e., Capital One and Cipher Mining go up and down completely randomly.

Pair Corralation between Capital One and Cipher Mining

Considering the 90-day investment horizon Capital One is expected to generate 7.91 times less return on investment than Cipher Mining. But when comparing it to its historical volatility, Capital One Financial is 3.82 times less risky than Cipher Mining. It trades about 0.07 of its potential returns per unit of risk. Cipher Mining is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,534  in Cipher Mining on August 5, 2025 and sell it today you would earn a total of  331.00  from holding Cipher Mining or generate 21.58% return on investment over 90 days.

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

Capital One Financial  vs.  Cipher Mining

Capital One Financial

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Capital One Financial are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Capital One is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Cipher Mining

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cipher Mining are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain 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 Capital One and Cipher Mining

The main advantage of trading using opposite Capital One and Cipher Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital One 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 Capital One Financial 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.

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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 Transaction History module to view history of all your transactions and understand their impact on performance.