Correlation Between Nexters Warrant and Gaia
Can any of the company-specific risk be diversified away by investing in both Nexters Warrant and Gaia 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 Nexters Warrant and Gaia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nexters Warrant and Gaia Inc, you can compare the effects of market volatilities on Nexters Warrant and Gaia 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 Nexters Warrant with a short position of Gaia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexters Warrant and Gaia.
Diversification Opportunities for Nexters Warrant and Gaia
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nexters and Gaia is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Nexters Warrant and Gaia Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaia Inc and Nexters Warrant 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 Nexters Warrant are associated (or correlated) with Gaia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaia Inc has no effect on the direction of Nexters Warrant i.e., Nexters Warrant and Gaia go up and down completely randomly.
Pair Corralation between Nexters Warrant and Gaia
Assuming the 90 days horizon Nexters Warrant is expected to generate 4.51 times more return on investment than Gaia. However, Nexters Warrant is 4.51 times more volatile than Gaia Inc. It trades about -0.01 of its potential returns per unit of risk. Gaia Inc is currently generating about -0.13 per unit of risk. If you would invest 2.00 in Nexters Warrant on January 12, 2025 and sell it today you would lose (0.35) from holding Nexters Warrant or give up 17.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 40.91% |
| Values | Daily Returns |
Nexters Warrant vs. Gaia Inc
Performance |
| Timeline |
| Nexters Warrant |
| Gaia Inc |
Nexters Warrant and Gaia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexters Warrant and Gaia
The main advantage of trading using opposite Nexters Warrant and Gaia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexters Warrant position performs unexpectedly, Gaia 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 Gaia will offset losses from the drop in Gaia's long position.| Nexters Warrant vs. GDEV Inc | Nexters Warrant vs. AEye Inc | Nexters Warrant vs. Arqit Quantum Warrants | Nexters Warrant vs. Xos Equity Warrants |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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