Correlation Between Comcast Corp and Amc Entertainment

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

Diversification Opportunities for Comcast Corp and Amc Entertainment

0.61
  Correlation Coefficient

Poor diversification

The 3 months correlation between Comcast and Amc Entertainment is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Comcast Corp A and Amc Entertainment Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amc Entertainment and Comcast 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 Comcast Corp A 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 Comcast Corp i.e., Comcast Corp and Amc Entertainment go up and down completely randomly.

Pair Corralation between Comcast Corp and Amc Entertainment

Assuming the 90 days horizon Comcast Corp A is expected to under-perform the Amc Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, Comcast Corp A is 2.29 times less risky than Amc Entertainment. The stock trades about -0.33 of its potential returns per unit of risk. The Amc Entertainment Holdings is currently generating about -0.13 of returns per unit of risk over similar time horizon. If you would invest  957.00  in Amc Entertainment Holdings on June 26, 2022 and sell it today you would lose (158.00)  from holding Amc Entertainment Holdings or give up 16.51% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Comcast Corp A  vs.  Amc Entertainment Holdings

 Performance (%) 
       Timeline  
Comcast Corp A 
Comcast Performance
0 of 100
Over the last 90 days Comcast Corp A 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 basic indicators remain somewhat strong which may send shares a bit higher in October 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Comcast Price Channel

Amc Entertainment 
Amc Entertainment Performance
0 of 100
Over the last 90 days Amc Entertainment Holdings 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 primary indicators remain somewhat strong which may send shares a bit higher in October 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Amc Entertainment Price Channel

Comcast Corp and Amc Entertainment Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Comcast Corp and Amc Entertainment

The main advantage of trading using opposite Comcast Corp and Amc Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comcast 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.
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The idea behind Comcast Corp A 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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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.

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