Correlation Between National CineMedia and BOS Better
Can any of the company-specific risk be diversified away by investing in both National CineMedia and BOS Better 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 BOS Better into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and BOS Better Online, you can compare the effects of market volatilities on National CineMedia and BOS Better 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 BOS Better. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and BOS Better.
Diversification Opportunities for National CineMedia and BOS Better
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between National and BOS is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and BOS Better Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOS Better Online 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 BOS Better. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOS Better Online has no effect on the direction of National CineMedia i.e., National CineMedia and BOS Better go up and down completely randomly.
Pair Corralation between National CineMedia and BOS Better
Given the investment horizon of 90 days National CineMedia is expected to generate 1.62 times more return on investment than BOS Better. However, National CineMedia is 1.62 times more volatile than BOS Better Online. It trades about 0.06 of its potential returns per unit of risk. BOS Better Online is currently generating about 0.02 per unit of risk. If you would invest 359.00 in National CineMedia on August 27, 2024 and sell it today you would earn a total of 329.00 from holding National CineMedia or generate 91.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National CineMedia vs. BOS Better Online
Performance |
| Timeline |
| National CineMedia |
| BOS Better Online |
National CineMedia and BOS Better Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and BOS Better
The main advantage of trading using opposite National CineMedia and BOS Better positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, BOS Better 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 BOS Better will offset losses from the drop in BOS Better's long position.| National CineMedia vs. Mirriad Advertising plc | National CineMedia vs. INEO Tech Corp | National CineMedia vs. Innovid Corp | National CineMedia vs. Townsquare Media |
| BOS Better vs. Mynaric AG ADR | BOS Better vs. Knowles Cor | BOS Better vs. Comtech Telecommunications Corp | BOS Better vs. Ituran Location and |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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