Correlation Between Impact Growth and Major Cineplex
Can any of the company-specific risk be diversified away by investing in both Impact Growth and Major Cineplex 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 Impact Growth and Major Cineplex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impact Growth REIT and Major Cineplex Lifestyle, you can compare the effects of market volatilities on Impact Growth and Major Cineplex 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 Impact Growth with a short position of Major Cineplex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impact Growth and Major Cineplex.
Diversification Opportunities for Impact Growth and Major Cineplex
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Impact and Major is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Impact Growth REIT and Major Cineplex Lifestyle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Major Cineplex Lifestyle and Impact Growth 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 Impact Growth REIT are associated (or correlated) with Major Cineplex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Major Cineplex Lifestyle has no effect on the direction of Impact Growth i.e., Impact Growth and Major Cineplex go up and down completely randomly.
Pair Corralation between Impact Growth and Major Cineplex
Assuming the 90 days trading horizon Impact Growth REIT is expected to under-perform the Major Cineplex. In addition to that, Impact Growth is 1.29 times more volatile than Major Cineplex Lifestyle. It trades about -0.13 of its total potential returns per unit of risk. Major Cineplex Lifestyle is currently generating about 0.15 per unit of volatility. If you would invest 412.00 in Major Cineplex Lifestyle on August 31, 2024 and sell it today you would earn a total of 14.00 from holding Major Cineplex Lifestyle or generate 3.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Impact Growth REIT vs. Major Cineplex Lifestyle
Performance |
| Timeline |
| Impact Growth REIT |
| Major Cineplex Lifestyle |
Impact Growth and Major Cineplex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impact Growth and Major Cineplex
The main advantage of trading using opposite Impact Growth and Major Cineplex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impact Growth position performs unexpectedly, Major Cineplex 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 Major Cineplex will offset losses from the drop in Major Cineplex's long position.| Impact Growth vs. CPN Retail Growth | Impact Growth vs. WHA Premium Growth | Impact Growth vs. Golden Ventures Leasehold | Impact Growth vs. LH Shopping Centers |
| Major Cineplex vs. LH Shopping Centers | Major Cineplex vs. Land and Houses | Major Cineplex vs. Quality Houses Property | Major Cineplex vs. Impact Growth REIT |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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