Correlation Between Afentra PLC and National CineMedia

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

By analyzing existing cross correlation between Afentra PLC and National CineMedia, you can compare the effects of market volatilities on Afentra PLC and National CineMedia 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 Afentra PLC with a short position of National CineMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afentra PLC and National CineMedia.

Diversification Opportunities for Afentra PLC and National CineMedia

0.0

Correlation Coefficient

Afentra PLC  National CineMedia

Pay attention - limited upside

The 3 months correlation between Afentra and National is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Afentra PLC and National CineMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National CineMedia and Afentra PLC 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 Afentra PLC are associated (or correlated) with National CineMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National CineMedia has no effect on the direction of Afentra PLC i.e., Afentra PLC and National CineMedia go up and down completely randomly.

Pair Corralation between Afentra PLC and National CineMedia

If you would invest  661.00  in National CineMedia on December 2, 2024 and sell it today you would earn a total of  8.00  from holding National CineMedia or generate 1.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Afentra PLC  vs.  National CineMedia

Afentra PLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Afentra PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Afentra PLC is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

National CineMedia

Risk-Adjusted Performance

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.

Pair Trading with Afentra PLC and National CineMedia

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

The idea behind Afentra PLC and National CineMedia 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.

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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.