Correlation Between NEXO and Gatechain Token
Can any of the company-specific risk be diversified away by investing in both NEXO and Gatechain Token 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 NEXO and Gatechain Token into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NEXO and Gatechain Token, you can compare the effects of market volatilities on NEXO and Gatechain Token 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 NEXO with a short position of Gatechain Token. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEXO and Gatechain Token.
Diversification Opportunities for NEXO and Gatechain Token
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NEXO and Gatechain is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding NEXO and Gatechain Token in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gatechain Token and NEXO 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 NEXO are associated (or correlated) with Gatechain Token. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gatechain Token has no effect on the direction of NEXO i.e., NEXO and Gatechain Token go up and down completely randomly.
Pair Corralation between NEXO and Gatechain Token
Assuming the 90 days trading horizon NEXO is expected to generate 0.64 times more return on investment than Gatechain Token. However, NEXO is 1.57 times less risky than Gatechain Token. It trades about -0.11 of its potential returns per unit of risk. Gatechain Token is currently generating about -0.11 per unit of risk. If you would invest 139.00 in NEXO on January 25, 2024 and sell it today you would lose (13.00) from holding NEXO or give up 9.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NEXO vs. Gatechain Token
Performance |
| Timeline |
| NEXO |
| Gatechain Token |
NEXO and Gatechain Token Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEXO and Gatechain Token
The main advantage of trading using opposite NEXO and Gatechain Token positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEXO position performs unexpectedly, Gatechain Token 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 Gatechain Token will offset losses from the drop in Gatechain Token's long position.The idea behind NEXO and Gatechain Token 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.| Gatechain Token vs. Solana | Gatechain Token vs. XRP | Gatechain Token vs. The Open Network | Gatechain Token vs. Staked Ether |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |