Correlation Between National CineMedia and Integral
Can any of the company-specific risk be diversified away by investing in both National CineMedia and Integral 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 Integral into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Integral Ad Science, you can compare the effects of market volatilities on National CineMedia and Integral 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 Integral. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Integral.
Diversification Opportunities for National CineMedia and Integral
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between National and Integral is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Integral Ad Science in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integral Ad Science 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 Integral. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integral Ad Science has no effect on the direction of National CineMedia i.e., National CineMedia and Integral go up and down completely randomly.
Pair Corralation between National CineMedia and Integral
Given the investment horizon of 90 days National CineMedia is expected to generate 2.17 times more return on investment than Integral. However, National CineMedia is 2.17 times more volatile than Integral Ad Science. It trades about 0.04 of its potential returns per unit of risk. Integral Ad Science is currently generating about 0.03 per unit of risk. If you would invest 409.00 in National CineMedia on August 27, 2024 and sell it today you would earn a total of 279.00 from holding National CineMedia or generate 68.22% 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. Integral Ad Science
Performance |
| Timeline |
| National CineMedia |
| Integral Ad Science |
National CineMedia and Integral Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Integral
The main advantage of trading using opposite National CineMedia and Integral positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, Integral 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 Integral will offset losses from the drop in Integral'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 |
| Integral vs. Mirriad Advertising plc | Integral vs. INEO Tech Corp | Integral vs. Innovid Corp | Integral vs. Townsquare Media |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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