Correlation Between AMC Entertainment and Icon Media

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

By analyzing existing cross correlation between AMC Entertainment Holdings and Icon Media Holdings, you can compare the effects of market volatilities on AMC Entertainment and Icon Media 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 AMC Entertainment with a short position of Icon Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMC Entertainment and Icon Media.

Diversification Opportunities for AMC Entertainment and Icon Media

-0.04

Correlation Coefficient

AMC Entertainment  Icon Media

Good diversification

The 3 months correlation between AMC and Icon is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding AMC Entertainment Holdings and Icon Media Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Media Holdings and AMC Entertainment 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 Entertainment Holdings are associated (or correlated) with Icon Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Media Holdings has no effect on the direction of AMC Entertainment i.e., AMC Entertainment and Icon Media go up and down completely randomly.

Pair Corralation between AMC Entertainment and Icon Media

Considering the 90-day investment horizon AMC Entertainment is expected to generate 8.36 times less return on investment than Icon Media. But when comparing it to its historical volatility, AMC Entertainment Holdings is 5.1 times less risky than Icon Media. It trades about 0.05 of its potential returns per unit of risk. Icon Media Holdings is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  0.03  in Icon Media Holdings on May 15, 2025 and sell it today you would lose (0.01) from holding Icon Media Holdings or give up 33.33% of portfolio value over 90 days.

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

AMC Entertainment Holdings  vs.  Icon Media Holdings

AMC Entertainment

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in AMC Entertainment Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting primary indicators, AMC Entertainment exhibited solid returns over the last few months and may actually be approaching a breakup point.

Icon Media Holdings

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Icon Media Holdings are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent basic indicators, Icon Media displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AMC Entertainment and Icon Media

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

The idea behind AMC Entertainment Holdings and Icon Media 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.