Correlation Between Albertsons Companies and National CineMedia
Can any of the company-specific risk be diversified away by investing in both Albertsons Companies and National CineMedia 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 Albertsons Companies and National CineMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Albertsons Companies and National CineMedia, you can compare the effects of market volatilities on Albertsons Companies and National CineMedia 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 Albertsons Companies with a short position of National CineMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Albertsons Companies and National CineMedia.
Diversification Opportunities for Albertsons Companies and National CineMedia
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Albertsons and National is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Albertsons Companies and National CineMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National CineMedia and Albertsons Companies 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 Albertsons Companies are associated (or correlated) with National CineMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National CineMedia has no effect on the direction of Albertsons Companies i.e., Albertsons Companies and National CineMedia go up and down completely randomly.
Pair Corralation between Albertsons Companies and National CineMedia
Considering the 90-day investment horizon Albertsons Companies is expected to under-perform the National CineMedia. But the stock apears to be less risky and, when comparing its historical volatility, Albertsons Companies is 1.92 times less risky than National CineMedia. The stock trades about -0.02 of its potential returns per unit of risk. The National CineMedia is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 673.00 in National CineMedia on September 12, 2024 and sell it today you would earn a total of 61.00 from holding National CineMedia or generate 9.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Albertsons Companies vs. National CineMedia
Performance |
| Timeline |
| Albertsons Companies |
| National CineMedia |
Albertsons Companies and National CineMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Albertsons Companies and National CineMedia
The main advantage of trading using opposite Albertsons Companies and National CineMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Albertsons Companies position performs unexpectedly, National CineMedia 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 National CineMedia will offset losses from the drop in National CineMedia's long position.| Albertsons Companies vs. Sprouts Farmers Market | Albertsons Companies vs. Krispy Kreme | Albertsons Companies vs. Grocery Outlet Holding | Albertsons Companies vs. Weis Markets |
| National CineMedia vs. MGO Global Common | National CineMedia vs. Baosheng Media Group | National CineMedia vs. Glory Star New | National CineMedia vs. Impact Fusion International |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Global Correlations Find global opportunities by holding instruments from different markets |