Correlation Between Magic Empire and Intelligent Living

Can any of the company-specific risk be diversified away by investing in both Magic Empire and Intelligent Living 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 Intelligent Living 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 Intelligent Living Application, you can compare the effects of market volatilities on Magic Empire and Intelligent Living 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 Intelligent Living. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magic Empire and Intelligent Living.

Diversification Opportunities for Magic Empire and Intelligent Living

0.41

Correlation Coefficient

Magic Empire  Intelligent Living

Very weak diversification

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

Pair Corralation between Magic Empire and Intelligent Living

Given the investment horizon of 90 days Magic Empire is expected to generate 16.58 times less return on investment than Intelligent Living. But when comparing it to its historical volatility, Magic Empire Global is 2.68 times less risky than Intelligent Living. It trades about 0.01 of its potential returns per unit of risk. Intelligent Living Application is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  46.00  in Intelligent Living Application on July 29, 2025 and sell it today you would earn a total of  10.00  from holding Intelligent Living Application or generate 21.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Magic Empire Global  vs.  Intelligent Living Application

Magic Empire Global

Risk-Adjusted Performance

Weakest

Over the last 90 days Magic Empire Global has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Magic Empire is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Intelligent Living

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Intelligent Living Application are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Intelligent Living reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Magic Empire and Intelligent Living

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

The idea behind Magic Empire Global and Intelligent Living Application 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.