Correlation Between MGT Capital and Top KingWin

Can any of the company-specific risk be diversified away by investing in both MGT Capital and Top KingWin 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 MGT Capital and Top KingWin into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MGT Capital Investments and Top KingWin, you can compare the effects of market volatilities on MGT Capital and Top KingWin 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 MGT Capital with a short position of Top KingWin. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGT Capital and Top KingWin.

Diversification Opportunities for MGT Capital and Top KingWin

-0.41

Correlation Coefficient

MGT Capital  Top KingWin

Very good diversification

The 3 months correlation between MGT and Top is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding MGT Capital Investments and Top KingWin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Top KingWin and MGT Capital 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 MGT Capital Investments are associated (or correlated) with Top KingWin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Top KingWin has no effect on the direction of MGT Capital i.e., MGT Capital and Top KingWin go up and down completely randomly.

Pair Corralation between MGT Capital and Top KingWin

If you would invest  0.60  in MGT Capital Investments on September 4, 2024 and sell it today you would earn a total of  0.00  from holding MGT Capital Investments or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	0.4%
Values	Daily Returns

MGT Capital Investments  vs.  Top KingWin

MGT Capital Investments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MGT Capital Investments has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, MGT Capital is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Top KingWin

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Top KingWin are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Top KingWin demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MGT Capital and Top KingWin

The main advantage of trading using opposite MGT Capital and Top KingWin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGT Capital position performs unexpectedly, Top KingWin 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 Top KingWin will offset losses from the drop in Top KingWin's long position.

The idea behind MGT Capital Investments and Top KingWin pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.