Correlation Between PLAYTECH and OTP Bank
Can any of the company-specific risk be diversified away by investing in both PLAYTECH and OTP Bank 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 PLAYTECH and OTP Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLAYTECH and OTP Bank Nyrt, you can compare the effects of market volatilities on PLAYTECH and OTP Bank 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 PLAYTECH with a short position of OTP Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYTECH and OTP Bank.
Diversification Opportunities for PLAYTECH and OTP Bank
Good diversification
The 3 months correlation between PLAYTECH and OTP is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding PLAYTECH and OTP Bank Nyrt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OTP Bank Nyrt and PLAYTECH 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 PLAYTECH are associated (or correlated) with OTP Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OTP Bank Nyrt has no effect on the direction of PLAYTECH i.e., PLAYTECH and OTP Bank go up and down completely randomly.
Pair Corralation between PLAYTECH and OTP Bank
Assuming the 90 days trading horizon PLAYTECH is expected to under-perform the OTP Bank. But the stock apears to be less risky and, when comparing its historical volatility, PLAYTECH is 1.75 times less risky than OTP Bank. The stock trades about -0.49 of its potential returns per unit of risk. The OTP Bank Nyrt is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 5,312 in OTP Bank Nyrt on October 12, 2024 and sell it today you would earn a total of 118.00 from holding OTP Bank Nyrt or generate 2.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLAYTECH vs. OTP Bank Nyrt
Performance |
| Timeline |
| PLAYTECH |
| OTP Bank Nyrt |
PLAYTECH and OTP Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLAYTECH and OTP Bank
The main advantage of trading using opposite PLAYTECH and OTP Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAYTECH position performs unexpectedly, OTP Bank 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 OTP Bank will offset losses from the drop in OTP Bank's long position.| PLAYTECH vs. Columbia Sportswear | PLAYTECH vs. ePlay Digital | PLAYTECH vs. TRAVEL LEISURE DL 01 | PLAYTECH vs. PLAYTIKA HOLDING DL 01 |
| OTP Bank vs. Ameriprise Financial | OTP Bank vs. UNIQA INSURANCE GR | OTP Bank vs. PLAYTECH | OTP Bank vs. PLAY2CHILL SA ZY |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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