Correlation Between National CineMedia and Connexa Sports

Can any of the company-specific risk be diversified away by investing in both National CineMedia and Connexa Sports 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 Connexa Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between National CineMedia and Connexa Sports Technologies, you can compare the effects of market volatilities on National CineMedia and Connexa Sports 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 Connexa Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Connexa Sports.

Diversification Opportunities for National CineMedia and Connexa Sports

-0.02

Correlation Coefficient

National CineMedia  Connexa Sports

Good diversification

The 3 months correlation between National and Connexa is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Connexa Sports Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Connexa Sports Techn 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 Connexa Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Connexa Sports Techn has no effect on the direction of National CineMedia i.e., National CineMedia and Connexa Sports go up and down completely randomly.

Pair Corralation between National CineMedia and Connexa Sports

Given the investment horizon of 90 days National CineMedia is expected to under-perform the Connexa Sports. But the stock apears to be less risky and, when comparing its historical volatility, National CineMedia is 2.29 times less risky than Connexa Sports. The stock trades about -0.39 of its potential returns per unit of risk. The Connexa Sports Technologies is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  120.00  in Connexa Sports Technologies on October 11, 2024 and sell it today you would earn a total of  12.00  from holding Connexa Sports Technologies or generate 10.0% return on investment over 90 days.

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

National CineMedia  vs.  Connexa Sports Technologies

National CineMedia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days National CineMedia has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's primary indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Connexa Sports Techn

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Connexa Sports Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with National CineMedia and Connexa Sports

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

The idea behind National CineMedia and Connexa Sports Technologies 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.