Correlation Between Summit Hotel and Playtika Holding
Can any of the company-specific risk be diversified away by investing in both Summit Hotel 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 Summit Hotel and Playtika Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Hotel Properties and Playtika Holding Corp, you can compare the effects of market volatilities on Summit Hotel 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 Summit Hotel with a short position of Playtika Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Hotel and Playtika Holding.
Diversification Opportunities for Summit Hotel and Playtika Holding
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Summit and Playtika is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Summit Hotel Properties 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 Summit Hotel 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 Summit Hotel Properties 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 Summit Hotel i.e., Summit Hotel and Playtika Holding go up and down completely randomly.
Pair Corralation between Summit Hotel and Playtika Holding
Considering the 90-day investment horizon Summit Hotel Properties is expected to under-perform the Playtika Holding. But the stock apears to be less risky and, when comparing its historical volatility, Summit Hotel Properties is 1.25 times less risky than Playtika Holding. The stock trades about -0.04 of its potential returns per unit of risk. The Playtika Holding Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 700.00 in Playtika Holding Corp on November 4, 2024 and sell it today you would earn a total of 17.00 from holding Playtika Holding Corp or generate 2.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Hotel Properties vs. Playtika Holding Corp
Performance |
| Timeline |
| Summit Hotel Properties |
| Playtika Holding Corp |
Summit Hotel and Playtika Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Hotel and Playtika Holding
The main advantage of trading using opposite Summit Hotel and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Hotel 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.| Summit Hotel vs. Diamondrock Hospitality | Summit Hotel vs. RLJ Lodging Trust | Summit Hotel vs. Pebblebrook Hotel Trust | Summit Hotel vs. Sunstone Hotel Investors |
| 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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