Correlation Between Cisco Systems and Stronghold Digital

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

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

Diversification Opportunities for Cisco Systems and Stronghold Digital

0.0

Correlation Coefficient

Cisco Systems  Stronghold Digital

Pay attention - limited upside

The 3 months correlation between Cisco and Stronghold is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and Stronghold Digital Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stronghold Digital Mining and Cisco Systems 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 Cisco Systems are associated (or correlated) with Stronghold Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stronghold Digital Mining has no effect on the direction of Cisco Systems i.e., Cisco Systems and Stronghold Digital go up and down completely randomly.

Pair Corralation between Cisco Systems and Stronghold Digital

If you would invest  5,898  in Cisco Systems on May 2, 2025 and sell it today you would earn a total of  930.00  from holding Cisco Systems or generate 15.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

Cisco Systems  vs.  Stronghold Digital Mining

Cisco Systems

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cisco Systems are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Cisco Systems displayed solid returns over the last few months and may actually be approaching a breakup point.

Stronghold Digital Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Stronghold Digital Mining has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward indicators, Stronghold Digital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Cisco Systems and Stronghold Digital

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

The idea behind Cisco Systems and Stronghold Digital 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.