Correlation Between PLAYTIKA HOLDING and CeoTronics
Can any of the company-specific risk be diversified away by investing in both PLAYTIKA HOLDING and CeoTronics 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 PLAYTIKA HOLDING and CeoTronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLAYTIKA HOLDING DL 01 and CeoTronics AG, you can compare the effects of market volatilities on PLAYTIKA HOLDING and CeoTronics 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 PLAYTIKA HOLDING with a short position of CeoTronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYTIKA HOLDING and CeoTronics.
Diversification Opportunities for PLAYTIKA HOLDING and CeoTronics
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PLAYTIKA and CeoTronics is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding PLAYTIKA HOLDING DL 01 and CeoTronics AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CeoTronics AG and PLAYTIKA HOLDING 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 PLAYTIKA HOLDING DL 01 are associated (or correlated) with CeoTronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CeoTronics AG has no effect on the direction of PLAYTIKA HOLDING i.e., PLAYTIKA HOLDING and CeoTronics go up and down completely randomly.
Pair Corralation between PLAYTIKA HOLDING and CeoTronics
Assuming the 90 days horizon PLAYTIKA HOLDING DL 01 is expected to under-perform the CeoTronics. But the stock apears to be less risky and, when comparing its historical volatility, PLAYTIKA HOLDING DL 01 is 1.74 times less risky than CeoTronics. The stock trades about -0.42 of its potential returns per unit of risk. The CeoTronics AG is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 525.00 in CeoTronics AG on September 24, 2024 and sell it today you would earn a total of 60.00 from holding CeoTronics AG or generate 11.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLAYTIKA HOLDING DL 01 vs. CeoTronics AG
Performance |
| Timeline |
| PLAYTIKA HOLDING |
| CeoTronics AG |
PLAYTIKA HOLDING and CeoTronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLAYTIKA HOLDING and CeoTronics
The main advantage of trading using opposite PLAYTIKA HOLDING and CeoTronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAYTIKA HOLDING position performs unexpectedly, CeoTronics 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 CeoTronics will offset losses from the drop in CeoTronics' long position.| PLAYTIKA HOLDING vs. Nintendo Co | PLAYTIKA HOLDING vs. Sea Limited | PLAYTIKA HOLDING vs. Electronic Arts | PLAYTIKA HOLDING vs. NEXON Co |
| CeoTronics vs. PLAYTIKA HOLDING DL 01 | CeoTronics vs. PROSIEBENSAT1 MEDIADR4 | CeoTronics vs. Ubisoft Entertainment SA | CeoTronics vs. GigaMedia |
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 the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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