Correlation Between NEXO and Chainlink
Can any of the company-specific risk be diversified away by investing in both NEXO and Chainlink 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 Chainlink into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NEXO and Chainlink, you can compare the effects of market volatilities on NEXO and Chainlink 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 Chainlink. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEXO and Chainlink.
Diversification Opportunities for NEXO and Chainlink
Very weak diversification
The 3 months correlation between NEXO and Chainlink is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding NEXO and Chainlink in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chainlink 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 Chainlink. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chainlink has no effect on the direction of NEXO i.e., NEXO and Chainlink go up and down completely randomly.
Pair Corralation between NEXO and Chainlink
Assuming the 90 days trading horizon NEXO is expected to generate 0.67 times more return on investment than Chainlink. However, NEXO is 1.5 times less risky than Chainlink. It trades about -0.07 of its potential returns per unit of risk. Chainlink is currently generating about -0.2 per unit of risk. If you would invest 132.00 in NEXO on January 26, 2024 and sell it today you would lose (8.00) from holding NEXO or give up 6.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NEXO vs. Chainlink
Performance |
| Timeline |
| NEXO |
| Chainlink |
NEXO and Chainlink Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEXO and Chainlink
The main advantage of trading using opposite NEXO and Chainlink positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEXO position performs unexpectedly, Chainlink 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 Chainlink will offset losses from the drop in Chainlink's long position.The idea behind NEXO and Chainlink 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |