Correlation Between NEM and USD Coin

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both NEM and USD Coin 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 NEM and USD Coin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NEM and USD Coin, you can compare the effects of market volatilities on NEM and USD Coin 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 NEM with a short position of USD Coin. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEM and USD Coin.

Diversification Opportunities for NEM and USD Coin

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between NEM and USD is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NEM and USD Coin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USD Coin and NEM 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 NEM are associated (or correlated) with USD Coin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USD Coin has no effect on the direction of NEM i.e., NEM and USD Coin go up and down completely randomly.

Pair Corralation between NEM and USD Coin

If you would invest  4.18  in NEM on December 30, 2023 and sell it today you would earn a total of  1.07  from holding NEM or generate 25.6% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

NEM  vs.  USD Coin

 Performance 
       Timeline  
NEM 

Risk-Adjusted Performance

8 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in NEM are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady primary indicators, NEM exhibited solid returns over the last few months and may actually be approaching a breakup point.
USD Coin 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days USD Coin has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, USD Coin is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

NEM and USD Coin Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with NEM and USD Coin

The main advantage of trading using opposite NEM and USD Coin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEM position performs unexpectedly, USD Coin 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 USD Coin will offset losses from the drop in USD Coin's long position.
The idea behind NEM and USD Coin 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.
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.

Other Complementary Tools

Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
AI Portfolio Architect
Use AI to generate optimal portfolios and find profitable investment opportunities
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Content Syndication
Quickly integrate customizable finance content to your own investment portal
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
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing