Correlation Between National CineMedia and Corporacion America
Can any of the company-specific risk be diversified away by investing in both National CineMedia and Corporacion America 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 Corporacion America into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Corporacion America Airports, you can compare the effects of market volatilities on National CineMedia and Corporacion America 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 Corporacion America. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Corporacion America.
Diversification Opportunities for National CineMedia and Corporacion America
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between National and Corporacion is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Corporacion America Airports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporacion America 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 Corporacion America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporacion America has no effect on the direction of National CineMedia i.e., National CineMedia and Corporacion America go up and down completely randomly.
Pair Corralation between National CineMedia and Corporacion America
Given the investment horizon of 90 days National CineMedia is expected to generate 3.26 times more return on investment than Corporacion America. However, National CineMedia is 3.26 times more volatile than Corporacion America Airports. It trades about 0.06 of its potential returns per unit of risk. Corporacion America Airports is currently generating about 0.09 per unit of risk. If you would invest 275.00 in National CineMedia on September 13, 2024 and sell it today you would earn a total of 470.00 from holding National CineMedia or generate 170.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
National CineMedia vs. Corporacion America Airports
Performance |
| Timeline |
| National CineMedia |
| Corporacion America |
National CineMedia and Corporacion America Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Corporacion America
The main advantage of trading using opposite National CineMedia and Corporacion America positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, Corporacion America 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 Corporacion America will offset losses from the drop in Corporacion America'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 |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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