Correlation Between PlayAGS and Build A
Can any of the company-specific risk be diversified away by investing in both PlayAGS and Build A 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 PlayAGS and Build A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PlayAGS and Build A Bear Workshop, you can compare the effects of market volatilities on PlayAGS and Build A 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 PlayAGS with a short position of Build A. Check out your portfolio center. Please also check ongoing floating volatility patterns of PlayAGS and Build A.
Diversification Opportunities for PlayAGS and Build A
Very poor diversification
The 3 months correlation between PlayAGS and Build is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding PlayAGS and Build A Bear Workshop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Build A Bear and PlayAGS 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 PlayAGS are associated (or correlated) with Build A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Build A Bear has no effect on the direction of PlayAGS i.e., PlayAGS and Build A go up and down completely randomly.
Pair Corralation between PlayAGS and Build A
Considering the 90-day investment horizon PlayAGS is expected to generate 5.1 times less return on investment than Build A. But when comparing it to its historical volatility, PlayAGS is 12.44 times less risky than Build A. It trades about 0.16 of its potential returns per unit of risk. Build A Bear Workshop is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,711 in Build A Bear Workshop on August 26, 2024 and sell it today you would earn a total of 108.00 from holding Build A Bear Workshop or generate 2.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PlayAGS vs. Build A Bear Workshop
Performance |
| Timeline |
| PlayAGS |
| Build A Bear |
PlayAGS and Build A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PlayAGS and Build A
The main advantage of trading using opposite PlayAGS and Build A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PlayAGS position performs unexpectedly, Build A 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 Build A will offset losses from the drop in Build A's long position.| PlayAGS vs. Light Wonder | PlayAGS vs. Everi Holdings | PlayAGS vs. Inspired Entertainment | PlayAGS vs. International Game Technology |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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