Correlation Between Playstudios and Swarmio Media
Can any of the company-specific risk be diversified away by investing in both Playstudios and Swarmio Media 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 Playstudios and Swarmio Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Playstudios and Swarmio Media Holdings, you can compare the effects of market volatilities on Playstudios and Swarmio Media 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 Playstudios with a short position of Swarmio Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playstudios and Swarmio Media.
Diversification Opportunities for Playstudios and Swarmio Media
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Playstudios and Swarmio is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Playstudios and Swarmio Media Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swarmio Media Holdings and Playstudios 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 Playstudios are associated (or correlated) with Swarmio Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swarmio Media Holdings has no effect on the direction of Playstudios i.e., Playstudios and Swarmio Media go up and down completely randomly.
Pair Corralation between Playstudios and Swarmio Media
Given the investment horizon of 90 days Playstudios is expected to under-perform the Swarmio Media. But the stock apears to be less risky and, when comparing its historical volatility, Playstudios is 6.86 times less risky than Swarmio Media. The stock trades about -0.03 of its potential returns per unit of risk. The Swarmio Media Holdings is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 25.00 in Swarmio Media Holdings on August 27, 2024 and sell it today you would lose (24.33) from holding Swarmio Media Holdings or give up 97.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 31.85% |
| Values | Daily Returns |
Playstudios vs. Swarmio Media Holdings
Performance |
| Timeline |
| Playstudios |
| Swarmio Media Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Playstudios and Swarmio Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playstudios and Swarmio Media
The main advantage of trading using opposite Playstudios and Swarmio Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playstudios position performs unexpectedly, Swarmio Media 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 Swarmio Media will offset losses from the drop in Swarmio Media's long position.The idea behind Playstudios and Swarmio Media Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |