Correlation Between Playtika Holding and African Agriculture
Can any of the company-specific risk be diversified away by investing in both Playtika Holding and African Agriculture 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 Playtika Holding and African Agriculture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Playtika Holding Corp and African Agriculture Holdings, you can compare the effects of market volatilities on Playtika Holding and African Agriculture 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 Playtika Holding with a short position of African Agriculture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and African Agriculture.
Diversification Opportunities for Playtika Holding and African Agriculture
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Playtika and African is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and African Agriculture Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on African Agriculture and Playtika Holding 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 Playtika Holding Corp are associated (or correlated) with African Agriculture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of African Agriculture has no effect on the direction of Playtika Holding i.e., Playtika Holding and African Agriculture go up and down completely randomly.
Pair Corralation between Playtika Holding and African Agriculture
Given the investment horizon of 90 days Playtika Holding Corp is expected to generate 0.05 times more return on investment than African Agriculture. However, Playtika Holding Corp is 18.24 times less risky than African Agriculture. It trades about 0.14 of its potential returns per unit of risk. African Agriculture Holdings is currently generating about -0.33 per unit of risk. If you would invest 730.00 in Playtika Holding Corp on September 12, 2024 and sell it today you would earn a total of 96.00 from holding Playtika Holding Corp or generate 13.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 20.31% |
| Values | Daily Returns |
Playtika Holding Corp vs. African Agriculture Holdings
Performance |
| Timeline |
| Playtika Holding Corp |
| African Agriculture |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Playtika Holding and African Agriculture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playtika Holding and African Agriculture
The main advantage of trading using opposite Playtika Holding and African Agriculture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtika Holding position performs unexpectedly, African Agriculture 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 African Agriculture will offset losses from the drop in African Agriculture's long position.| Playtika Holding vs. SohuCom | Playtika Holding vs. Playstudios | Playtika Holding vs. GDEV Inc | Playtika Holding vs. NetEase |
| African Agriculture vs. Trupanion | African Agriculture vs. Employers Holdings | African Agriculture vs. Sligro Food Group | African Agriculture vs. Siriuspoint |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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