Correlation Between National CineMedia and Air Lease
Can any of the company-specific risk be diversified away by investing in both National CineMedia and Air Lease 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 Air Lease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Air Lease, you can compare the effects of market volatilities on National CineMedia and Air Lease 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 Air Lease. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Air Lease.
Diversification Opportunities for National CineMedia and Air Lease
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between National and Air is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Air Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Lease 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 Air Lease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Lease has no effect on the direction of National CineMedia i.e., National CineMedia and Air Lease go up and down completely randomly.
Pair Corralation between National CineMedia and Air Lease
Given the investment horizon of 90 days National CineMedia is expected to generate 4.28 times more return on investment than Air Lease. However, National CineMedia is 4.28 times more volatile than Air Lease. It trades about 0.06 of its potential returns per unit of risk. Air Lease is currently generating about 0.04 per unit of risk. If you would invest 250.00 in National CineMedia on September 14, 2024 and sell it today you would earn a total of 480.00 from holding National CineMedia or generate 192.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National CineMedia vs. Air Lease
Performance |
| Timeline |
| National CineMedia |
| Air Lease |
National CineMedia and Air Lease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Air Lease
The main advantage of trading using opposite National CineMedia and Air Lease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, Air Lease 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 Air Lease will offset losses from the drop in Air Lease'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 |
| Air Lease vs. Alta Equipment Group | Air Lease vs. McGrath RentCorp | Air Lease vs. Herc Holdings | Air Lease vs. HE Equipment Services |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |