Correlation Between NEXON Co and Golden Matrix

Can any of the company-specific risk be diversified away by investing in both NEXON Co and Golden Matrix 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 Golden Matrix into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NEXON Co and Golden Matrix Group, you can compare the effects of market volatilities on NEXON Co and Golden Matrix 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 Golden Matrix. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEXON Co and Golden Matrix.

Diversification Opportunities for NEXON Co and Golden Matrix

-0.24

Correlation Coefficient

NEXON Co  Golden Matrix

Very good diversification

The 3 months correlation between NEXON and Golden is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding NEXON Co and Golden Matrix Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Matrix Group 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 are associated (or correlated) with Golden Matrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Matrix Group has no effect on the direction of NEXON Co i.e., NEXON Co and Golden Matrix go up and down completely randomly.

Pair Corralation between NEXON Co and Golden Matrix

Assuming the 90 days horizon NEXON Co is expected to under-perform the Golden Matrix. But the pink sheet apears to be less risky and, when comparing its historical volatility, NEXON Co is 2.7 times less risky than Golden Matrix. The pink sheet trades about -0.11 of its potential returns per unit of risk. The Golden Matrix Group is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  234.00  in Golden Matrix Group on September 4, 2024 and sell it today you would lose (1.00) from holding Golden Matrix Group or give up 0.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

NEXON Co  vs.  Golden Matrix Group

NEXON Co

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NEXON Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Golden Matrix Group

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Golden Matrix Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile technical and fundamental indicators, Golden Matrix may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with NEXON Co and Golden Matrix

The main advantage of trading using opposite NEXON Co and Golden Matrix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEXON Co position performs unexpectedly, Golden Matrix 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 Golden Matrix will offset losses from the drop in Golden Matrix's long position.

The idea behind NEXON Co and Golden Matrix Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.