Correlation Between American Eagle and PLAYTIKA HOLDING
Can any of the company-specific risk be diversified away by investing in both American Eagle 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 American Eagle and PLAYTIKA HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Eagle Outfitters and PLAYTIKA HOLDING DL 01, you can compare the effects of market volatilities on American Eagle 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 American Eagle with a short position of PLAYTIKA HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Eagle and PLAYTIKA HOLDING.
Diversification Opportunities for American Eagle and PLAYTIKA HOLDING
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and PLAYTIKA is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding American Eagle Outfitters and PLAYTIKA HOLDING DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAYTIKA HOLDING and American Eagle 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 American Eagle Outfitters 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 has no effect on the direction of American Eagle i.e., American Eagle and PLAYTIKA HOLDING go up and down completely randomly.
Pair Corralation between American Eagle and PLAYTIKA HOLDING
Assuming the 90 days trading horizon American Eagle Outfitters is expected to under-perform the PLAYTIKA HOLDING. But the stock apears to be less risky and, when comparing its historical volatility, American Eagle Outfitters is 1.24 times less risky than PLAYTIKA HOLDING. The stock trades about -0.04 of its potential returns per unit of risk. The PLAYTIKA HOLDING DL 01 is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 710.00 in PLAYTIKA HOLDING DL 01 on September 2, 2024 and sell it today you would earn a total of 70.00 from holding PLAYTIKA HOLDING DL 01 or generate 9.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Eagle Outfitters vs. PLAYTIKA HOLDING DL 01
Performance |
| Timeline |
| American Eagle Outfitters |
| PLAYTIKA HOLDING |
American Eagle and PLAYTIKA HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Eagle and PLAYTIKA HOLDING
The main advantage of trading using opposite American Eagle and PLAYTIKA HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Eagle 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.| American Eagle vs. Apple Inc | American Eagle vs. Apple Inc | American Eagle vs. Apple Inc | American Eagle vs. Apple Inc |
| PLAYTIKA HOLDING vs. Nintendo Co | PLAYTIKA HOLDING vs. Sea Limited | PLAYTIKA HOLDING vs. Superior Plus Corp | PLAYTIKA HOLDING vs. NMI Holdings |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |