Correlation Between National CineMedia and Senmiao Technology
Can any of the company-specific risk be diversified away by investing in both National CineMedia and Senmiao Technology 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 National CineMedia and Senmiao Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Senmiao Technology, you can compare the effects of market volatilities on National CineMedia and Senmiao Technology 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 National CineMedia with a short position of Senmiao Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Senmiao Technology.
Diversification Opportunities for National CineMedia and Senmiao Technology
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between National and Senmiao is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Senmiao Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senmiao Technology and National CineMedia 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 National CineMedia are associated (or correlated) with Senmiao Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senmiao Technology has no effect on the direction of National CineMedia i.e., National CineMedia and Senmiao Technology go up and down completely randomly.
Pair Corralation between National CineMedia and Senmiao Technology
Given the investment horizon of 90 days National CineMedia is expected to generate 0.95 times more return on investment than Senmiao Technology. However, National CineMedia is 1.05 times less risky than Senmiao Technology. It trades about -0.02 of its potential returns per unit of risk. Senmiao Technology is currently generating about -0.27 per unit of risk. If you would invest 672.00 in National CineMedia on November 5, 2024 and sell it today you would lose (13.00) from holding National CineMedia or give up 1.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National CineMedia vs. Senmiao Technology
Performance |
| Timeline |
| National CineMedia |
| Senmiao Technology |
National CineMedia and Senmiao Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Senmiao Technology
The main advantage of trading using opposite National CineMedia and Senmiao Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, Senmiao Technology 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 Senmiao Technology will offset losses from the drop in Senmiao Technology's long position.| National CineMedia vs. MGO Global Common | National CineMedia vs. Baosheng Media Group | National CineMedia vs. Glory Star New | National CineMedia vs. Impact Fusion International |
| Senmiao Technology vs. X Financial Class | Senmiao Technology vs. Yirendai | Senmiao Technology vs. Pintec Technology Holdings | Senmiao Technology vs. Qudian Inc |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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