Correlation Between Magic Software and AEON METALS
Can any of the company-specific risk be diversified away by investing in both Magic Software and AEON METALS 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 Software and AEON METALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magic Software Enterprises and AEON METALS LTD, you can compare the effects of market volatilities on Magic Software and AEON METALS 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 Software with a short position of AEON METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magic Software and AEON METALS.
Diversification Opportunities for Magic Software and AEON METALS
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Magic and AEON is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Magic Software Enterprises and AEON METALS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEON METALS LTD and Magic Software 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 Software Enterprises are associated (or correlated) with AEON METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEON METALS LTD has no effect on the direction of Magic Software i.e., Magic Software and AEON METALS go up and down completely randomly.
Pair Corralation between Magic Software and AEON METALS
Assuming the 90 days horizon Magic Software is expected to generate 1435.07 times less return on investment than AEON METALS. But when comparing it to its historical volatility, Magic Software Enterprises is 41.83 times less risky than AEON METALS. It trades about 0.0 of its potential returns per unit of risk. AEON METALS LTD is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1.20 in AEON METALS LTD on November 1, 2024 and sell it today you would lose (1.15) from holding AEON METALS LTD or give up 95.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Magic Software Enterprises vs. AEON METALS LTD
Performance |
| Timeline |
| Magic Software Enter |
| AEON METALS LTD |
Magic Software and AEON METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magic Software and AEON METALS
The main advantage of trading using opposite Magic Software and AEON METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magic Software position performs unexpectedly, AEON METALS 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 AEON METALS will offset losses from the drop in AEON METALS's long position.| Magic Software vs. International Consolidated Airlines | Magic Software vs. TRADELINK ELECTRON | Magic Software vs. American Airlines Group | Magic Software vs. CANON MARKETING JP |
| AEON METALS vs. Haier Smart Home | AEON METALS vs. Thai Beverage Public | AEON METALS vs. CAIRN HOMES EO | AEON METALS vs. THAI BEVERAGE |
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.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |