Correlation Between Stronghold Digital and Marathon Digital

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

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

Diversification Opportunities for Stronghold Digital and Marathon Digital

-0.7

Correlation Coefficient

Stronghold Digital  Marathon Digital

Excellent diversification

The 3 months correlation between Stronghold and Marathon is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Stronghold Digital Mining and Marathon Digital Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marathon Digital Holdings and Stronghold Digital 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 Stronghold Digital Mining are associated (or correlated) with Marathon Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marathon Digital Holdings has no effect on the direction of Stronghold Digital i.e., Stronghold Digital and Marathon Digital go up and down completely randomly.

Pair Corralation between Stronghold Digital and Marathon Digital

If you would invest  1,315  in Marathon Digital Holdings on May 6, 2025 and sell it today you would earn a total of  289.00  from holding Marathon Digital Holdings or generate 21.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	1.61%
Values	Daily Returns

Stronghold Digital Mining  vs.  Marathon Digital Holdings

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.

Marathon Digital Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Marathon Digital Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Marathon Digital sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Stronghold Digital and Marathon Digital

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

The idea behind Stronghold Digital Mining and Marathon Digital Holdings 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..