Correlation Between National CineMedia and SL Green
Can any of the company-specific risk be diversified away by investing in both National CineMedia and SL Green 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 SL Green into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and SL Green Realty, you can compare the effects of market volatilities on National CineMedia and SL Green 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 SL Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and SL Green.
Diversification Opportunities for National CineMedia and SL Green
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between National and SLG is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and SL Green Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SL Green Realty 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 SL Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SL Green Realty has no effect on the direction of National CineMedia i.e., National CineMedia and SL Green go up and down completely randomly.
Pair Corralation between National CineMedia and SL Green
Given the investment horizon of 90 days National CineMedia is expected to generate 1.41 times more return on investment than SL Green. However, National CineMedia is 1.41 times more volatile than SL Green Realty. It trades about 0.09 of its potential returns per unit of risk. SL Green Realty is currently generating about 0.1 per unit of risk. If you would invest 400.00 in National CineMedia on September 13, 2024 and sell it today you would earn a total of 345.00 from holding National CineMedia or generate 86.25% 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. SL Green Realty
Performance |
| Timeline |
| National CineMedia |
| SL Green Realty |
National CineMedia and SL Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and SL Green
The main advantage of trading using opposite National CineMedia and SL Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia position performs unexpectedly, SL Green 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 SL Green will offset losses from the drop in SL Green'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 |
| SL Green vs. Boston Properties | SL Green vs. Douglas Emmett | SL Green vs. Kilroy Realty Corp | SL Green vs. Alexandria Real Estate |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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