Correlation Between Empire Global and Kambi Group

Can any of the company-specific risk be diversified away by investing in both Empire Global and Kambi Group 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 Empire Global and Kambi Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Empire Global Gaming and Kambi Group plc, you can compare the effects of market volatilities on Empire Global and Kambi Group 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 Empire Global with a short position of Kambi Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire Global and Kambi Group.

Diversification Opportunities for Empire Global and Kambi Group

0.8

Correlation Coefficient

Empire Global  Kambi Group

Very poor diversification

The 3 months correlation between Empire and Kambi is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Empire Global Gaming and Kambi Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kambi Group plc and Empire Global 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 Empire Global Gaming are associated (or correlated) with Kambi Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kambi Group plc has no effect on the direction of Empire Global i.e., Empire Global and Kambi Group go up and down completely randomly.

Pair Corralation between Empire Global and Kambi Group

If you would invest  0.00  in Empire Global Gaming on September 27, 2024 and sell it today you would earn a total of  0.00  from holding Empire Global Gaming or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.45%
Values	Daily Returns

Empire Global Gaming  vs.  Kambi Group plc

Empire Global Gaming

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Empire Global Gaming has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Kambi Group plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kambi Group plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's forward indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Empire Global and Kambi Group

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

The idea behind Empire Global Gaming and Kambi Group plc 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..