Correlation Between Cinedigm Corp and AMC Entertainment

Can any of the company-specific risk be diversified away by investing in both Cinedigm 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 Cinedigm 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 Cinedigm Corp and AMC Entertainment Holdings, you can compare the effects of market volatilities on Cinedigm 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 Cinedigm Corp with a short position of AMC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cinedigm Corp and AMC Entertainment.

Diversification Opportunities for Cinedigm Corp and AMC Entertainment

-0.13

Correlation Coefficient

Cinedigm Corp  AMC Entertainment

Good diversification

The 3 months correlation between Cinedigm and AMC is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cinedigm 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 Cinedigm 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 Cinedigm 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 Cinedigm Corp i.e., Cinedigm Corp and AMC Entertainment go up and down completely randomly.

Pair Corralation between Cinedigm Corp and AMC Entertainment

If you would invest  29.00  in Cinedigm Corp on September 22, 2024 and sell it today you would earn a total of  0.00  from holding Cinedigm Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Cinedigm Corp  vs.  AMC Entertainment Holdings

Cinedigm Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cinedigm Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Cinedigm Corp is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

AMC Entertainment

Risk-Adjusted Performance

0 of 100

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 latest conflicting performance, the Stock's primary indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Cinedigm Corp and AMC Entertainment

The main advantage of trading using opposite Cinedigm Corp and AMC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cinedigm 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 Cinedigm 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.

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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.