Correlation Between National CineMedia and Hudson Pacific
Can any of the company-specific risk be diversified away by investing in both National CineMedia and Hudson Pacific 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 Hudson Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Hudson Pacific Properties, you can compare the effects of market volatilities on National CineMedia and Hudson Pacific 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 Hudson Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Hudson Pacific.
Diversification Opportunities for National CineMedia and Hudson Pacific
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between National and Hudson is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Hudson Pacific Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hudson Pacific Properties 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 Hudson Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hudson Pacific Properties has no effect on the direction of National CineMedia i.e., National CineMedia and Hudson Pacific go up and down completely randomly.
Pair Corralation between National CineMedia and Hudson Pacific
Given the investment horizon of 90 days National CineMedia is expected to generate 0.96 times more return on investment than Hudson Pacific. However, National CineMedia is 1.04 times less risky than Hudson Pacific. It trades about 0.05 of its potential returns per unit of risk. Hudson Pacific Properties is currently generating about -0.02 per unit of risk. If you would invest 292.00 in National CineMedia on January 11, 2025 and sell it today you would earn a total of 276.00 from holding National CineMedia or generate 94.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National CineMedia vs. Hudson Pacific Properties
Performance |
| Timeline |
| National CineMedia |
| Hudson Pacific Properties |
National CineMedia and Hudson Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Hudson Pacific
The main advantage of trading using opposite National CineMedia and Hudson Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, Hudson Pacific 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 Hudson Pacific will offset losses from the drop in Hudson Pacific's long position.| National CineMedia vs. Baosheng Media Group | National CineMedia vs. Impact Fusion International | National CineMedia vs. ZW Data Action |
| Hudson Pacific vs. Kilroy Realty Corp | Hudson Pacific vs. Highwoods Properties | Hudson Pacific vs. Cousins Properties Incorporated | Hudson Pacific vs. Piedmont Office Realty |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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