Correlation Between Imax Corp and Lions Gate
Can any of the company-specific risk be diversified away by investing in both Imax Corp and Lions Gate 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 Imax Corp and Lions Gate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imax Corp and Lions Gate Entertainment, you can compare the effects of market volatilities on Imax Corp and Lions Gate 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 Imax Corp with a short position of Lions Gate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imax Corp and Lions Gate.
Diversification Opportunities for Imax Corp and Lions Gate
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Imax and Lions is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Imax Corp and Lions Gate Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lions Gate Entertainment and Imax Corp 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 Imax Corp are associated (or correlated) with Lions Gate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lions Gate Entertainment has no effect on the direction of Imax Corp i.e., Imax Corp and Lions Gate go up and down completely randomly.
Pair Corralation between Imax Corp and Lions Gate
Given the investment horizon of 90 days Imax Corp is expected to generate 0.77 times more return on investment than Lions Gate. However, Imax Corp is 1.29 times less risky than Lions Gate. It trades about 0.18 of its potential returns per unit of risk. Lions Gate Entertainment is currently generating about 0.03 per unit of risk. If you would invest 1,616 in Imax Corp on September 1, 2024 and sell it today you would earn a total of 1,016 from holding Imax Corp or generate 62.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Imax Corp vs. Lions Gate Entertainment
Performance |
| Timeline |
| Imax Corp |
| Lions Gate Entertainment |
Imax Corp and Lions Gate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imax Corp and Lions Gate
The main advantage of trading using opposite Imax Corp and Lions Gate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imax Corp position performs unexpectedly, Lions Gate 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 Lions Gate will offset losses from the drop in Lions Gate's long position.| Imax Corp vs. ADTRAN Inc | Imax Corp vs. Belden Inc | Imax Corp vs. ADC Therapeutics SA | Imax Corp vs. Comtech Telecommunications Corp |
| Lions Gate vs. Lions Gate Entertainment | Lions Gate vs. AMC Networks | Lions Gate vs. Altice USA | Lions Gate vs. Liberty Broadband Srs |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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