Correlation Between Gatechain Token and NEO
Can any of the company-specific risk be diversified away by investing in both Gatechain Token and NEO 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 Gatechain Token and NEO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gatechain Token and NEO, you can compare the effects of market volatilities on Gatechain Token and NEO 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 Gatechain Token with a short position of NEO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gatechain Token and NEO.
Diversification Opportunities for Gatechain Token and NEO
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Gatechain and NEO is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Gatechain Token and NEO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEO and Gatechain Token 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 Gatechain Token are associated (or correlated) with NEO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEO has no effect on the direction of Gatechain Token i.e., Gatechain Token and NEO go up and down completely randomly.
Pair Corralation between Gatechain Token and NEO
Assuming the 90 days horizon Gatechain Token is expected to generate 1.88 times less return on investment than NEO. But when comparing it to its historical volatility, Gatechain Token is 1.78 times less risky than NEO. It trades about 0.6 of its potential returns per unit of risk. NEO is currently generating about 0.63 of returns per unit of risk over similar time horizon. If you would invest 924.00 in NEO on September 2, 2024 and sell it today you would earn a total of 676.00 from holding NEO or generate 73.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gatechain Token vs. NEO
Performance |
| Timeline |
| Gatechain Token |
| NEO |
Gatechain Token and NEO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gatechain Token and NEO
The main advantage of trading using opposite Gatechain Token and NEO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gatechain Token position performs unexpectedly, NEO 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 NEO will offset losses from the drop in NEO's long position.| Gatechain Token vs. Staked Ether | Gatechain Token vs. EigenLayer | Gatechain Token vs. EOSDAC | Gatechain Token vs. BLZ |
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.
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