Correlation Between Magic Empire and Riot Blockchain
Can any of the company-specific risk be diversified away by investing in both Magic Empire and Riot Blockchain 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 Riot Blockchain 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 Riot Blockchain, you can compare the effects of market volatilities on Magic Empire and Riot Blockchain 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 Riot Blockchain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magic Empire and Riot Blockchain.
Diversification Opportunities for Magic Empire and Riot Blockchain
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Magic and Riot is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Magic Empire Global and Riot Blockchain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Riot Blockchain 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 Riot Blockchain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Riot Blockchain has no effect on the direction of Magic Empire i.e., Magic Empire and Riot Blockchain go up and down completely randomly.
Pair Corralation between Magic Empire and Riot Blockchain
Given the investment horizon of 90 days Magic Empire is expected to generate 1.15 times less return on investment than Riot Blockchain. In addition to that, Magic Empire is 2.65 times more volatile than Riot Blockchain. It trades about 0.02 of its total potential returns per unit of risk. Riot Blockchain is currently generating about 0.06 per unit of volatility. If you would invest 547.00 in Riot Blockchain on November 4, 2024 and sell it today you would earn a total of 641.00 from holding Riot Blockchain or generate 117.18% 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. Riot Blockchain
Performance |
| Timeline |
| Magic Empire Global |
| Riot Blockchain |
Magic Empire and Riot Blockchain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magic Empire and Riot Blockchain
The main advantage of trading using opposite Magic Empire and Riot Blockchain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magic Empire position performs unexpectedly, Riot Blockchain 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 Riot Blockchain will offset losses from the drop in Riot Blockchain's long position.| Magic Empire vs. Netcapital | Magic Empire vs. Applied Digital | Magic Empire vs. Zhong Yang Financial | Magic Empire vs. Mercurity Fintech Holding |
| Riot Blockchain vs. Hut 8 Corp | Riot Blockchain vs. CleanSpark | Riot Blockchain vs. Bit Digital | Riot Blockchain vs. Bitfarms |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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