Correlation Between Play2Chill and Novina SA
Can any of the company-specific risk be diversified away by investing in both Play2Chill and Novina SA 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 Play2Chill and Novina SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Play2Chill SA and Novina SA, you can compare the effects of market volatilities on Play2Chill and Novina SA 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 Play2Chill with a short position of Novina SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Play2Chill and Novina SA.
Diversification Opportunities for Play2Chill and Novina SA
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Play2Chill and Novina is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Play2Chill SA and Novina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Novina SA and Play2Chill 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 Play2Chill SA are associated (or correlated) with Novina SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Novina SA has no effect on the direction of Play2Chill i.e., Play2Chill and Novina SA go up and down completely randomly.
Pair Corralation between Play2Chill and Novina SA
Assuming the 90 days trading horizon Play2Chill SA is expected to generate 0.83 times more return on investment than Novina SA. However, Play2Chill SA is 1.2 times less risky than Novina SA. It trades about 0.04 of its potential returns per unit of risk. Novina SA is currently generating about -0.11 per unit of risk. If you would invest 400.00 in Play2Chill SA on August 28, 2024 and sell it today you would earn a total of 5.00 from holding Play2Chill SA or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Play2Chill SA vs. Novina SA
Performance |
| Timeline |
| Play2Chill SA |
| Novina SA |
Play2Chill and Novina SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Play2Chill and Novina SA
The main advantage of trading using opposite Play2Chill and Novina SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Play2Chill position performs unexpectedly, Novina SA 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 Novina SA will offset losses from the drop in Novina SA's long position.| Play2Chill vs. Asseco Business Solutions | Play2Chill vs. Detalion Games SA | Play2Chill vs. Asseco South Eastern | Play2Chill vs. Movie Games SA |
| Novina SA vs. Play2Chill SA | Novina SA vs. MCI Management SA | Novina SA vs. Igoria Trade SA | Novina SA vs. Noble Financials SA |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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