Correlation Between Harvest Meta and Harvest MicroStrategy

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

By analyzing existing cross correlation between Harvest Meta Enhanced and Harvest MicroStrategy Enhanced, you can compare the effects of market volatilities on Harvest Meta and Harvest MicroStrategy 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 Harvest Meta with a short position of Harvest MicroStrategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harvest Meta and Harvest MicroStrategy.

Diversification Opportunities for Harvest Meta and Harvest MicroStrategy

0.55

Correlation Coefficient

Harvest Meta  Harvest MicroStrategy

Very weak diversification

The 3 months correlation between Harvest and Harvest is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Harvest Meta Enhanced and Harvest MicroStrategy Enhanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvest MicroStrategy and Harvest Meta 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 Harvest Meta Enhanced are associated (or correlated) with Harvest MicroStrategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvest MicroStrategy has no effect on the direction of Harvest Meta i.e., Harvest Meta and Harvest MicroStrategy go up and down completely randomly.

Pair Corralation between Harvest Meta and Harvest MicroStrategy

Assuming the 90 days trading horizon Harvest Meta Enhanced is expected to generate 0.65 times more return on investment than Harvest MicroStrategy. However, Harvest Meta Enhanced is 1.55 times less risky than Harvest MicroStrategy. It trades about 0.23 of its potential returns per unit of risk. Harvest MicroStrategy Enhanced is currently generating about 0.08 per unit of risk. If you would invest  952.00  in Harvest Meta Enhanced on April 25, 2025 and sell it today you would earn a total of  286.00  from holding Harvest Meta Enhanced or generate 30.04% return on investment over 90 days.

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

Harvest Meta Enhanced  vs.  Harvest MicroStrategy Enhanced

Harvest Meta Enhanced

Risk-Adjusted Performance

Solid

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

Harvest MicroStrategy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Harvest MicroStrategy Enhanced are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Harvest MicroStrategy displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Harvest Meta and Harvest MicroStrategy

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

The idea behind Harvest Meta Enhanced and Harvest MicroStrategy Enhanced 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.