Correlation Between Nervos Network and Ethereum Classic
Can any of the company-specific risk be diversified away by investing in both Nervos Network and Ethereum Classic 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 Nervos Network and Ethereum Classic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nervos Network and Ethereum Classic, you can compare the effects of market volatilities on Nervos Network and Ethereum Classic 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 Nervos Network with a short position of Ethereum Classic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nervos Network and Ethereum Classic.
Diversification Opportunities for Nervos Network and Ethereum Classic
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nervos and Ethereum is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Nervos Network and Ethereum Classic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ethereum Classic and Nervos Network 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 Nervos Network are associated (or correlated) with Ethereum Classic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ethereum Classic has no effect on the direction of Nervos Network i.e., Nervos Network and Ethereum Classic go up and down completely randomly.
Pair Corralation between Nervos Network and Ethereum Classic
Assuming the 90 days trading horizon Nervos Network is expected to generate 2.67 times less return on investment than Ethereum Classic. But when comparing it to its historical volatility, Nervos Network is 1.36 times less risky than Ethereum Classic. It trades about 0.23 of its potential returns per unit of risk. Ethereum Classic is currently generating about 0.45 of returns per unit of risk over similar time horizon. If you would invest 1,857 in Ethereum Classic on August 31, 2024 and sell it today you would earn a total of 1,302 from holding Ethereum Classic or generate 70.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nervos Network vs. Ethereum Classic
Performance |
| Timeline |
| Nervos Network |
| Ethereum Classic |
Nervos Network and Ethereum Classic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nervos Network and Ethereum Classic
The main advantage of trading using opposite Nervos Network and Ethereum Classic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nervos Network position performs unexpectedly, Ethereum Classic 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 Ethereum Classic will offset losses from the drop in Ethereum Classic's long position.| Nervos Network vs. Bitcoin | Nervos Network vs. Dogecoin | Nervos Network vs. Bitcoin Cash | Nervos Network vs. Litecoin |
| Ethereum Classic vs. Bitcoin | Ethereum Classic vs. Dogecoin | Ethereum Classic vs. Bitcoin Cash | Ethereum Classic vs. Litecoin |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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