Correlation Between Nexon Co and Roblox Corp

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

By analyzing existing cross correlation between Nexon Co Ltd and Roblox Corp, you can compare the effects of market volatilities on Nexon Co and Roblox Corp 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 Nexon Co with a short position of Roblox Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexon Co and Roblox Corp.

Diversification Opportunities for Nexon Co and Roblox Corp

0.71

Correlation Coefficient

Nexon Co  Roblox Corp

Poor diversification

The 3 months correlation between Nexon and Roblox is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Nexon Co Ltd and Roblox Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roblox Corp and Nexon Co 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 Nexon Co Ltd are associated (or correlated) with Roblox Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roblox Corp has no effect on the direction of Nexon Co i.e., Nexon Co and Roblox Corp go up and down completely randomly.

Pair Corralation between Nexon Co and Roblox Corp

Assuming the 90 days horizon Nexon Co is expected to generate 3.63 times less return on investment than Roblox Corp. In addition to that, Nexon Co is 1.3 times more volatile than Roblox Corp. It trades about 0.09 of its total potential returns per unit of risk. Roblox Corp is currently generating about 0.41 per unit of volatility. If you would invest  7,409  in Roblox Corp on May 2, 2025 and sell it today you would earn a total of  6,370  from holding Roblox Corp or generate 85.98% return on investment over 90 days.

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

Nexon Co Ltd  vs.  Roblox Corp

Nexon Co

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nexon Co Ltd are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Nexon Co showed solid returns over the last few months and may actually be approaching a breakup point.

Roblox Corp

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Roblox Corp are ranked lower than 32 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak essential indicators, Roblox Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nexon Co and Roblox Corp

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

The idea behind Nexon Co Ltd and Roblox Corp 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.