Correlation Between National CineMedia and Comstock Holding
Can any of the company-specific risk be diversified away by investing in both National CineMedia and Comstock Holding 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 Comstock Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Comstock Holding Companies, you can compare the effects of market volatilities on National CineMedia and Comstock Holding 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 Comstock Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Comstock Holding.
Diversification Opportunities for National CineMedia and Comstock Holding
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between National and Comstock is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com 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 Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of National CineMedia i.e., National CineMedia and Comstock Holding go up and down completely randomly.
Pair Corralation between National CineMedia and Comstock Holding
Given the investment horizon of 90 days National CineMedia is expected to under-perform the Comstock Holding. But the stock apears to be less risky and, when comparing its historical volatility, National CineMedia is 1.39 times less risky than Comstock Holding. The stock trades about -0.22 of its potential returns per unit of risk. The Comstock Holding Companies is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 870.00 in Comstock Holding Companies on October 7, 2024 and sell it today you would lose (35.00) from holding Comstock Holding Companies or give up 4.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National CineMedia vs. Comstock Holding Companies
Performance |
| Timeline |
| National CineMedia |
| Comstock Holding Com |
National CineMedia and Comstock Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Comstock Holding
The main advantage of trading using opposite National CineMedia and Comstock Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, Comstock Holding 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 Comstock Holding will offset losses from the drop in Comstock Holding'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 |
| Comstock Holding vs. St Joe Company | Comstock Holding vs. Stratus Properties | Comstock Holding vs. Mitsui Fudosan Co | Comstock Holding vs. New World Development |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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