Correlation Between Empire Global and Network International
Can any of the company-specific risk be diversified away by investing in both Empire Global and Network International 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 Network International 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 Network International Holdings, you can compare the effects of market volatilities on Empire Global and Network International 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 Network International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire Global and Network International.
Diversification Opportunities for Empire Global and Network International
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Empire and Network is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Empire Global Gaming and Network International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Network International 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 Network International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Network International has no effect on the direction of Empire Global i.e., Empire Global and Network International go up and down completely randomly.
Pair Corralation between Empire Global and Network International
Given the investment horizon of 90 days Empire Global Gaming is expected to generate 6.77 times more return on investment than Network International. However, Empire Global is 6.77 times more volatile than Network International Holdings. It trades about 0.01 of its potential returns per unit of risk. Network International Holdings is currently generating about 0.05 per unit of risk. If you would invest 1.60 in Empire Global Gaming on August 28, 2024 and sell it today you would lose (1.59) from holding Empire Global Gaming or give up 99.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 93.89% |
| Values | Daily Returns |
Empire Global Gaming vs. Network International Holdings
Performance |
| Timeline |
| Empire Global Gaming |
| Network International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Empire Global and Network International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empire Global and Network International
The main advantage of trading using opposite Empire Global and Network International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empire Global position performs unexpectedly, Network International 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 Network International will offset losses from the drop in Network International's long position.| Empire Global vs. Real Luck Group | Empire Global vs. Betmakers Technology Group | Empire Global vs. Jackpot Digital |
| Network International vs. Cerberus Cyber Sentinel | Network International vs. Gorilla Technology Group | Network International vs. Taoping | Network International vs. Crowdstrike Holdings |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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