Correlation Between NXG NextGen and Bain Capital
Can any of the company-specific risk be diversified away by investing in both NXG NextGen and Bain Capital 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 NXG NextGen and Bain Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NXG NextGen Infrastructure and Bain Capital Specialty, you can compare the effects of market volatilities on NXG NextGen and Bain Capital 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 NXG NextGen with a short position of Bain Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of NXG NextGen and Bain Capital.
Diversification Opportunities for NXG NextGen and Bain Capital
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NXG and Bain is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding NXG NextGen Infrastructure and Bain Capital Specialty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bain Capital Specialty and NXG NextGen 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 NXG NextGen Infrastructure are associated (or correlated) with Bain Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bain Capital Specialty has no effect on the direction of NXG NextGen i.e., NXG NextGen and Bain Capital go up and down completely randomly.
Pair Corralation between NXG NextGen and Bain Capital
Considering the 90-day investment horizon NXG NextGen Infrastructure is expected to generate 1.87 times more return on investment than Bain Capital. However, NXG NextGen is 1.87 times more volatile than Bain Capital Specialty. It trades about 0.06 of its potential returns per unit of risk. Bain Capital Specialty is currently generating about 0.09 per unit of risk. If you would invest 3,077 in NXG NextGen Infrastructure on August 28, 2024 and sell it today you would earn a total of 1,920 from holding NXG NextGen Infrastructure or generate 62.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NXG NextGen Infrastructure vs. Bain Capital Specialty
Performance |
| Timeline |
| NXG NextGen Infrastr |
| Bain Capital Specialty |
NXG NextGen and Bain Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NXG NextGen and Bain Capital
The main advantage of trading using opposite NXG NextGen and Bain Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NXG NextGen position performs unexpectedly, Bain Capital 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 Bain Capital will offset losses from the drop in Bain Capital's long position.| NXG NextGen vs. PowerUp Acquisition Corp | NXG NextGen vs. Aurora Innovation | NXG NextGen vs. HUMANA INC | NXG NextGen vs. Aquagold International |
| Bain Capital vs. BlackRock TCP Capital | Bain Capital vs. Triplepoint Venture Growth | Bain Capital vs. Sixth Street Specialty | Bain Capital vs. Golub Capital BDC |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |