Correlation Between Cinemark Holdings and IQIYI
Can any of the company-specific risk be diversified away by investing in both Cinemark Holdings and IQIYI 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 Cinemark Holdings and IQIYI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cinemark Holdings and iQIYI Inc, you can compare the effects of market volatilities on Cinemark Holdings and IQIYI 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 Cinemark Holdings with a short position of IQIYI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cinemark Holdings and IQIYI.
Diversification Opportunities for Cinemark Holdings and IQIYI
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cinemark and IQIYI is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Cinemark Holdings and iQIYI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iQIYI Inc and Cinemark Holdings 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 Cinemark Holdings are associated (or correlated) with IQIYI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iQIYI Inc has no effect on the direction of Cinemark Holdings i.e., Cinemark Holdings and IQIYI go up and down completely randomly.
Pair Corralation between Cinemark Holdings and IQIYI
Considering the 90-day investment horizon Cinemark Holdings is expected to generate 0.59 times more return on investment than IQIYI. However, Cinemark Holdings is 1.71 times less risky than IQIYI. It trades about 0.09 of its potential returns per unit of risk. iQIYI Inc is currently generating about 0.0 per unit of risk. If you would invest 1,324 in Cinemark Holdings on August 24, 2024 and sell it today you would earn a total of 1,939 from holding Cinemark Holdings or generate 146.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cinemark Holdings vs. iQIYI Inc
Performance |
| Timeline |
| Cinemark Holdings |
| iQIYI Inc |
Cinemark Holdings and IQIYI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cinemark Holdings and IQIYI
The main advantage of trading using opposite Cinemark Holdings and IQIYI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cinemark Holdings position performs unexpectedly, IQIYI 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 IQIYI will offset losses from the drop in IQIYI's long position.| Cinemark Holdings vs. News Corp B | Cinemark Holdings vs. Marcus | Cinemark Holdings vs. Liberty Media | Cinemark Holdings vs. Warner Music Group |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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