Correlation Between Mattel and Playtika Holding
Can any of the company-specific risk be diversified away by investing in both Mattel 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 Mattel and Playtika Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mattel Inc and Playtika Holding Corp, you can compare the effects of market volatilities on Mattel 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 Mattel with a short position of Playtika Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mattel and Playtika Holding.
Diversification Opportunities for Mattel and Playtika Holding
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Mattel and Playtika is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Mattel Inc 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 Mattel 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 Mattel Inc 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 Mattel i.e., Mattel and Playtika Holding go up and down completely randomly.
Pair Corralation between Mattel and Playtika Holding
Considering the 90-day investment horizon Mattel Inc is expected to generate 0.79 times more return on investment than Playtika Holding. However, Mattel Inc is 1.26 times less risky than Playtika Holding. It trades about 0.01 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 1,867 in Mattel Inc on August 31, 2024 and sell it today you would earn a total of 35.00 from holding Mattel Inc or generate 1.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mattel Inc vs. Playtika Holding Corp
Performance |
| Timeline |
| Mattel Inc |
| Playtika Holding Corp |
Mattel and Playtika Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mattel and Playtika Holding
The main advantage of trading using opposite Mattel and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mattel 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.| Mattel vs. Funko Inc | Mattel vs. JAKKS Pacific | Mattel vs. Madison Square Garden | Mattel vs. Life Time Group |
| 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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