Correlation Between Chainlink and Pixels

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

By analyzing existing cross correlation between Chainlink and Pixels, you can compare the effects of market volatilities on Chainlink and Pixels 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 Chainlink with a short position of Pixels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chainlink and Pixels.

Diversification Opportunities for Chainlink and Pixels

0.75

Correlation Coefficient

Chainlink  Pixels

Poor diversification

The 3 months correlation between Chainlink and Pixels is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Chainlink and Pixels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pixels and Chainlink 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 Chainlink are associated (or correlated) with Pixels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pixels has no effect on the direction of Chainlink i.e., Chainlink and Pixels go up and down completely randomly.

Pair Corralation between Chainlink and Pixels

Assuming the 90 days trading horizon Chainlink is expected to generate 0.59 times more return on investment than Pixels. However, Chainlink is 1.71 times less risky than Pixels. It trades about 0.09 of its potential returns per unit of risk. Pixels is currently generating about 0.04 per unit of risk. If you would invest  1,506  in Chainlink on April 23, 2025 and sell it today you would earn a total of  334.00  from holding Chainlink or generate 22.18% return on investment over 90 days.

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

Chainlink  vs.  Pixels

Chainlink

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Chainlink are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Chainlink exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pixels

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Pixels are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Pixels exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Chainlink and Pixels

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

The idea behind Chainlink and Pixels 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.