Correlation Between Empire Global and BrainChip Holdings
Can any of the company-specific risk be diversified away by investing in both Empire Global and BrainChip Holdings 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 Empire Global and BrainChip Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Empire Global Gaming and BrainChip Holdings, you can compare the effects of market volatilities on Empire Global and BrainChip Holdings 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 Empire Global with a short position of BrainChip Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire Global and BrainChip Holdings.
Diversification Opportunities for Empire Global and BrainChip Holdings
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Empire and BrainChip is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Empire Global Gaming and BrainChip Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BrainChip Holdings and Empire Global 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 Empire Global Gaming are associated (or correlated) with BrainChip Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BrainChip Holdings has no effect on the direction of Empire Global i.e., Empire Global and BrainChip Holdings go up and down completely randomly.
Pair Corralation between Empire Global and BrainChip Holdings
Given the investment horizon of 90 days Empire Global Gaming is expected to generate 1.9 times more return on investment than BrainChip Holdings. However, Empire Global is 1.9 times more volatile than BrainChip Holdings. It trades about 0.01 of its potential returns per unit of risk. BrainChip Holdings is currently generating about 0.01 per unit of risk. If you would invest 1.50 in Empire Global Gaming on August 29, 2024 and sell it today you would lose (1.49) from holding Empire Global Gaming or give up 99.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Empire Global Gaming vs. BrainChip Holdings
Performance |
| Timeline |
| Empire Global Gaming |
| BrainChip Holdings |
Empire Global and BrainChip Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empire Global and BrainChip Holdings
The main advantage of trading using opposite Empire Global and BrainChip Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empire Global position performs unexpectedly, BrainChip Holdings 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 BrainChip Holdings will offset losses from the drop in BrainChip Holdings' long position.| Empire Global vs. Real Luck Group | Empire Global vs. Betmakers Technology Group | Empire Global vs. Jackpot Digital |
| BrainChip Holdings vs. NVIDIA | BrainChip Holdings vs. Intel | BrainChip Holdings vs. Taiwan Semiconductor Manufacturing | BrainChip Holdings vs. Marvell Technology Group |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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