Correlation Between 00165CAP9 and SFL

Can any of the company-specific risk be diversified away by investing in both 00165CAP9 and SFL 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 00165CAP9 and SFL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AMC ENTMT HLDGS and SFL Corporation, you can compare the effects of market volatilities on 00165CAP9 and SFL 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 00165CAP9 with a short position of SFL. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00165CAP9 and SFL.

Diversification Opportunities for 00165CAP9 and SFL

0.42

Correlation Coefficient

00165CAP9  SFL

Very weak diversification

The 3 months correlation between 00165CAP9 and SFL is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding AMC ENTMT HLDGS and SFL Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SFL Corporation and 00165CAP9 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 AMC ENTMT HLDGS are associated (or correlated) with SFL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SFL Corporation has no effect on the direction of 00165CAP9 i.e., 00165CAP9 and SFL go up and down completely randomly.

Pair Corralation between 00165CAP9 and SFL

Assuming the 90 days trading horizon AMC ENTMT HLDGS is expected to under-perform the SFL. In addition to that, 00165CAP9 is 1.75 times more volatile than SFL Corporation. It trades about -0.18 of its total potential returns per unit of risk. SFL Corporation is currently generating about -0.13 per unit of volatility. If you would invest  968.00  in SFL Corporation on December 30, 2024 and sell it today you would lose (153.00) from holding SFL Corporation or give up 15.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	41.94%
Values	Daily Returns

AMC ENTMT HLDGS  vs.  SFL Corp.

AMC ENTMT HLDGS

Risk-Adjusted Performance

Very Weak

Over the last 90 days AMC ENTMT HLDGS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for AMC ENTMT HLDGS investors.

SFL Corporation

Risk-Adjusted Performance

Very Weak

Over the last 90 days SFL Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with 00165CAP9 and SFL

The main advantage of trading using opposite 00165CAP9 and SFL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00165CAP9 position performs unexpectedly, SFL 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 SFL will offset losses from the drop in SFL's long position.

The idea behind AMC ENTMT HLDGS and SFL Corporation 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.