Correlation Between Acco Brands and Playtika Holding
Can any of the company-specific risk be diversified away by investing in both Acco Brands and Playtika Holding 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 Acco Brands and Playtika Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and Playtika Holding Corp, you can compare the effects of market volatilities on Acco Brands and Playtika Holding 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 Acco Brands with a short position of Playtika Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and Playtika Holding.
Diversification Opportunities for Acco Brands and Playtika Holding
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Acco and Playtika is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Playtika Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Playtika Holding Corp and Acco Brands 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 Acco Brands are associated (or correlated) with Playtika Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Playtika Holding Corp has no effect on the direction of Acco Brands i.e., Acco Brands and Playtika Holding go up and down completely randomly.
Pair Corralation between Acco Brands and Playtika Holding
Given the investment horizon of 90 days Acco Brands is expected to generate 0.93 times more return on investment than Playtika Holding. However, Acco Brands is 1.07 times less risky than Playtika Holding. It trades about 0.02 of its potential returns per unit of risk. Playtika Holding Corp is currently generating about 0.01 per unit of risk. If you would invest 523.00 in Acco Brands on August 31, 2024 and sell it today you would earn a total of 59.00 from holding Acco Brands or generate 11.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acco Brands vs. Playtika Holding Corp
Performance |
| Timeline |
| Acco Brands |
| Playtika Holding Corp |
Acco Brands and Playtika Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acco Brands and Playtika Holding
The main advantage of trading using opposite Acco Brands and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands position performs unexpectedly, Playtika Holding 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 Playtika Holding will offset losses from the drop in Playtika Holding's long position.| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
| Playtika Holding vs. Doubledown Interactive Co | Playtika Holding vs. SohuCom | Playtika Holding vs. Playstudios | Playtika Holding vs. GDEV Inc |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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