Correlation Between Magic Empire and Evercore Partners
Can any of the company-specific risk be diversified away by investing in both Magic Empire and Evercore Partners 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 Magic Empire and Evercore Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magic Empire Global and Evercore Partners, you can compare the effects of market volatilities on Magic Empire and Evercore Partners 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 Magic Empire with a short position of Evercore Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magic Empire and Evercore Partners.
Diversification Opportunities for Magic Empire and Evercore Partners
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Magic and Evercore is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Magic Empire Global and Evercore Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evercore Partners and Magic Empire 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 Magic Empire Global are associated (or correlated) with Evercore Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evercore Partners has no effect on the direction of Magic Empire i.e., Magic Empire and Evercore Partners go up and down completely randomly.
Pair Corralation between Magic Empire and Evercore Partners
Given the investment horizon of 90 days Magic Empire is expected to generate 3.3 times less return on investment than Evercore Partners. In addition to that, Magic Empire is 1.11 times more volatile than Evercore Partners. It trades about 0.06 of its total potential returns per unit of risk. Evercore Partners is currently generating about 0.23 per unit of volatility. If you would invest 25,774 in Evercore Partners on August 24, 2024 and sell it today you would earn a total of 5,179 from holding Evercore Partners or generate 20.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Magic Empire Global vs. Evercore Partners
Performance |
| Timeline |
| Magic Empire Global |
| Evercore Partners |
Magic Empire and Evercore Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magic Empire and Evercore Partners
The main advantage of trading using opposite Magic Empire and Evercore Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magic Empire position performs unexpectedly, Evercore Partners 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 Evercore Partners will offset losses from the drop in Evercore Partners' long position.| Magic Empire vs. Netcapital | Magic Empire vs. Applied Blockchain | Magic Empire vs. Zhong Yang Financial | Magic Empire vs. Mercurity Fintech Holding |
| Evercore Partners vs. PJT Partners | Evercore Partners vs. Moelis Co | Evercore Partners vs. Perella Weinberg Partners | Evercore Partners vs. Jefferies Financial 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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