Correlation Between Great Elm and Argo Blockchain

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

By analyzing existing cross correlation between Great Elm Capital and Argo Blockchain plc, you can compare the effects of market volatilities on Great Elm and Argo Blockchain 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 Great Elm with a short position of Argo Blockchain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great Elm and Argo Blockchain.

Diversification Opportunities for Great Elm and Argo Blockchain

-0.72

Correlation Coefficient

Great Elm  Argo Blockchain

Pay attention - limited upside

The 3 months correlation between Great and Argo is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Great Elm Capital and Argo Blockchain plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argo Blockchain plc and Great Elm 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 Great Elm Capital are associated (or correlated) with Argo Blockchain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argo Blockchain plc has no effect on the direction of Great Elm i.e., Great Elm and Argo Blockchain go up and down completely randomly.

Pair Corralation between Great Elm and Argo Blockchain

Assuming the 90 days horizon Great Elm Capital is expected to generate 0.04 times more return on investment than Argo Blockchain. However, Great Elm Capital is 26.56 times less risky than Argo Blockchain. It trades about 0.19 of its potential returns per unit of risk. Argo Blockchain plc is currently generating about -0.07 per unit of risk. If you would invest  2,448  in Great Elm Capital on April 24, 2025 and sell it today you would earn a total of  96.00  from holding Great Elm Capital or generate 3.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

Great Elm Capital  vs.  Argo Blockchain plc

Great Elm Capital

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Great Elm Capital are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, Great Elm is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Argo Blockchain plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Argo Blockchain plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in August 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Great Elm and Argo Blockchain

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

The idea behind Great Elm Capital and Argo Blockchain plc 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.