Correlation Between Nexon Co and Capcom
Can any of the company-specific risk be diversified away by investing in both Nexon Co and Capcom 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 Capcom 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 Capcom Co, you can compare the effects of market volatilities on Nexon Co and Capcom 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 Capcom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexon Co and Capcom.
Diversification Opportunities for Nexon Co and Capcom
Good diversification
The 3 months correlation between Nexon and Capcom is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Nexon Co Ltd and Capcom Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capcom 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 Capcom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capcom has no effect on the direction of Nexon Co i.e., Nexon Co and Capcom go up and down completely randomly.
Pair Corralation between Nexon Co and Capcom
Assuming the 90 days horizon Nexon Co Ltd is expected to under-perform the Capcom. But the pink sheet apears to be less risky and, when comparing its historical volatility, Nexon Co Ltd is 8.48 times less risky than Capcom. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Capcom Co is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,552 in Capcom Co on October 21, 2024 and sell it today you would earn a total of 558.00 from holding Capcom Co or generate 35.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 67.74% |
| Values | Daily Returns |
Nexon Co Ltd vs. Capcom Co
Performance |
| Timeline |
| Nexon Co |
| Capcom |
Nexon Co and Capcom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexon Co and Capcom
The main advantage of trading using opposite Nexon Co and Capcom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexon Co position performs unexpectedly, Capcom 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 Capcom will offset losses from the drop in Capcom's long position.| Nexon Co vs. i3 Interactive | Nexon Co vs. Sega Sammy Holdings | Nexon Co vs. Square Enix Holdings | Nexon Co vs. Nintendo Co |
| Capcom vs. Square Enix Holdings | Capcom vs. CD Projekt SA | Capcom vs. Sega Sammy Holdings | Capcom vs. Square Enix Holdings |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |