Correlation Between Aerofoam Metals and National CineMedia
Can any of the company-specific risk be diversified away by investing in both Aerofoam Metals 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 Aerofoam Metals and National CineMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aerofoam Metals and National CineMedia, you can compare the effects of market volatilities on Aerofoam Metals 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 Aerofoam Metals with a short position of National CineMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aerofoam Metals and National CineMedia.
Diversification Opportunities for Aerofoam Metals and National CineMedia
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aerofoam and National is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aerofoam Metals and National CineMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National CineMedia and Aerofoam Metals 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 Aerofoam Metals 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 Aerofoam Metals i.e., Aerofoam Metals and National CineMedia go up and down completely randomly.
Pair Corralation between Aerofoam Metals and National CineMedia
Given the investment horizon of 90 days Aerofoam Metals is expected to generate 7.56 times more return on investment than National CineMedia. However, Aerofoam Metals is 7.56 times more volatile than National CineMedia. It trades about 0.06 of its potential returns per unit of risk. National CineMedia is currently generating about 0.06 per unit of risk. If you would invest 0.00 in Aerofoam Metals on September 13, 2024 and sell it today you would earn a total of 0.01 from holding Aerofoam Metals or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Aerofoam Metals vs. National CineMedia
Performance |
| Timeline |
| Aerofoam Metals |
| National CineMedia |
Aerofoam Metals and National CineMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aerofoam Metals and National CineMedia
The main advantage of trading using opposite Aerofoam Metals and National CineMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aerofoam Metals 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.| Aerofoam Metals vs. Arhaus Inc | Aerofoam Metals vs. Floor Decor Holdings | Aerofoam Metals vs. Live Ventures | Aerofoam Metals vs. ATT Inc |
| 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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