Correlation Between Cineverse Corp and AMC Entertainment

Can any of the company-specific risk be diversified away by investing in both Cineverse Corp and AMC Entertainment 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 Cineverse Corp and AMC Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cineverse Corp and AMC Entertainment Holdings, you can compare the effects of market volatilities on Cineverse Corp and AMC Entertainment 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 Cineverse Corp with a short position of AMC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cineverse Corp and AMC Entertainment.

Diversification Opportunities for Cineverse Corp and AMC Entertainment

-0.22

Correlation Coefficient

Cineverse Corp  AMC Entertainment

Very good diversification

The 3 months correlation between Cineverse and AMC is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Cineverse Corp and AMC Entertainment Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMC Entertainment and Cineverse Corp 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 Cineverse Corp are associated (or correlated) with AMC Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMC Entertainment has no effect on the direction of Cineverse Corp i.e., Cineverse Corp and AMC Entertainment go up and down completely randomly.

Pair Corralation between Cineverse Corp and AMC Entertainment

Given the investment horizon of 90 days Cineverse Corp is expected to generate 1.49 times more return on investment than AMC Entertainment. However, Cineverse Corp is 1.49 times more volatile than AMC Entertainment Holdings. It trades about 0.02 of its potential returns per unit of risk. AMC Entertainment Holdings is currently generating about -0.2 per unit of risk. If you would invest  377.00  in Cineverse Corp on November 28, 2024 and sell it today you would lose (1.00) from holding Cineverse Corp or give up 0.27% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Cineverse Corp  vs.  AMC Entertainment Holdings

Cineverse Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cineverse Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Cineverse Corp may actually be approaching a critical reversion point that can send shares even higher in March 2025.

AMC Entertainment

Risk-Adjusted Performance

Very Weak

Over the last 90 days AMC Entertainment Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's primary indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Cineverse Corp and AMC Entertainment

The main advantage of trading using opposite Cineverse Corp and AMC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cineverse Corp position performs unexpectedly, AMC Entertainment 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 AMC Entertainment will offset losses from the drop in AMC Entertainment's long position.

The idea behind Cineverse Corp and AMC Entertainment Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.