Correlation Between Eightco Holdings and NEXE Innovations
Can any of the company-specific risk be diversified away by investing in both Eightco Holdings and NEXE Innovations 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 Eightco Holdings and NEXE Innovations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eightco Holdings and NEXE Innovations, you can compare the effects of market volatilities on Eightco Holdings and NEXE Innovations 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 Eightco Holdings with a short position of NEXE Innovations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eightco Holdings and NEXE Innovations.
Diversification Opportunities for Eightco Holdings and NEXE Innovations
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Eightco and NEXE is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Eightco Holdings and NEXE Innovations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXE Innovations and Eightco Holdings 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 Eightco Holdings are associated (or correlated) with NEXE Innovations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXE Innovations has no effect on the direction of Eightco Holdings i.e., Eightco Holdings and NEXE Innovations go up and down completely randomly.
Pair Corralation between Eightco Holdings and NEXE Innovations
Given the investment horizon of 90 days Eightco Holdings is expected to under-perform the NEXE Innovations. In addition to that, Eightco Holdings is 1.47 times more volatile than NEXE Innovations. It trades about -0.08 of its total potential returns per unit of risk. NEXE Innovations is currently generating about -0.09 per unit of volatility. If you would invest 33.00 in NEXE Innovations on August 25, 2024 and sell it today you would lose (3.00) from holding NEXE Innovations or give up 9.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Eightco Holdings vs. NEXE Innovations
Performance |
| Timeline |
| Eightco Holdings |
| NEXE Innovations |
Eightco Holdings and NEXE Innovations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eightco Holdings and NEXE Innovations
The main advantage of trading using opposite Eightco Holdings and NEXE Innovations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eightco Holdings position performs unexpectedly, NEXE Innovations 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 NEXE Innovations will offset losses from the drop in NEXE Innovations' long position.| Eightco Holdings vs. Ardagh Metal Packaging | Eightco Holdings vs. Avery Dennison Corp | Eightco Holdings vs. Amcor PLC | Eightco Holdings vs. Packaging Corp of |
| NEXE Innovations vs. Imaflex | NEXE Innovations vs. Karat Packaging | NEXE Innovations vs. DSS Inc | NEXE Innovations vs. Myers Industries |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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