Correlation Between Magic Internet and Magic Eden
Can any of the company-specific risk be diversified away by investing in both Magic Internet and Magic Eden 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 Internet and Magic Eden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magic Internet Money and Magic Eden, you can compare the effects of market volatilities on Magic Internet and Magic Eden 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 Internet with a short position of Magic Eden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magic Internet and Magic Eden.
Diversification Opportunities for Magic Internet and Magic Eden
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Magic and Magic is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Magic Internet Money and Magic Eden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magic Eden and Magic Internet 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 Internet Money are associated (or correlated) with Magic Eden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magic Eden has no effect on the direction of Magic Internet i.e., Magic Internet and Magic Eden go up and down completely randomly.
Pair Corralation between Magic Internet and Magic Eden
Assuming the 90 days trading horizon Magic Internet Money is expected to generate 0.13 times more return on investment than Magic Eden. However, Magic Internet Money is 7.88 times less risky than Magic Eden. It trades about 0.21 of its potential returns per unit of risk. Magic Eden is currently generating about -0.31 per unit of risk. If you would invest 96.00 in Magic Internet Money on November 4, 2024 and sell it today you would earn a total of 4.00 from holding Magic Internet Money or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Magic Internet Money vs. Magic Eden
Performance |
| Timeline |
| Magic Internet Money |
| Magic Eden |
Magic Internet and Magic Eden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magic Internet and Magic Eden
The main advantage of trading using opposite Magic Internet and Magic Eden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magic Internet position performs unexpectedly, Magic Eden 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 Magic Eden will offset losses from the drop in Magic Eden's long position.| Magic Internet vs. XRP | Magic Internet vs. Solana | Magic Internet vs. Sui | Magic Internet vs. Staked Ether |
| Magic Eden vs. Magic Internet Money | Magic Eden vs. Staked Ether | Magic Eden vs. Phala Network | Magic Eden vs. EigenLayer |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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