Correlation Between NXG NextGen and Korea Closed
Can any of the company-specific risk be diversified away by investing in both NXG NextGen and Korea Closed 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 Korea Closed 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 Korea Closed, you can compare the effects of market volatilities on NXG NextGen and Korea Closed 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 Korea Closed. Check out your portfolio center. Please also check ongoing floating volatility patterns of NXG NextGen and Korea Closed.
Diversification Opportunities for NXG NextGen and Korea Closed
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NXG and Korea is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding NXG NextGen Infrastructure and Korea Closed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Closed 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 Korea Closed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Closed has no effect on the direction of NXG NextGen i.e., NXG NextGen and Korea Closed go up and down completely randomly.
Pair Corralation between NXG NextGen and Korea Closed
Considering the 90-day investment horizon NXG NextGen Infrastructure is expected to generate 1.52 times more return on investment than Korea Closed. However, NXG NextGen is 1.52 times more volatile than Korea Closed. It trades about 0.66 of its potential returns per unit of risk. Korea Closed is currently generating about 0.16 per unit of risk. If you would invest 4,028 in NXG NextGen Infrastructure on October 20, 2024 and sell it today you would earn a total of 1,031 from holding NXG NextGen Infrastructure or generate 25.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NXG NextGen Infrastructure vs. Korea Closed
Performance |
| Timeline |
| NXG NextGen Infrastr |
| Korea Closed |
NXG NextGen and Korea Closed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NXG NextGen and Korea Closed
The main advantage of trading using opposite NXG NextGen and Korea Closed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NXG NextGen position performs unexpectedly, Korea Closed 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 Korea Closed will offset losses from the drop in Korea Closed's long position.| NXG NextGen vs. MFS Investment Grade | NXG NextGen vs. Eaton Vance National | NXG NextGen vs. Nuveen California Select | NXG NextGen vs. Federated Premier Municipal |
| Korea Closed vs. Mexico Equity And | Korea Closed vs. Western Asset Global | Korea Closed vs. New Germany Closed | Korea Closed vs. MFS Charter Income |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |