Correlation Between Playtika Holding and Thunder Power
Can any of the company-specific risk be diversified away by investing in both Playtika Holding and Thunder Power 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 Thunder Power 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 Thunder Power Holdings,, you can compare the effects of market volatilities on Playtika Holding and Thunder Power 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 Thunder Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and Thunder Power.
Diversification Opportunities for Playtika Holding and Thunder Power
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Playtika and Thunder is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and Thunder Power Holdings, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thunder Power Holdings, 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 Thunder Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thunder Power Holdings, has no effect on the direction of Playtika Holding i.e., Playtika Holding and Thunder Power go up and down completely randomly.
Pair Corralation between Playtika Holding and Thunder Power
Given the investment horizon of 90 days Playtika Holding Corp is expected to generate 0.18 times more return on investment than Thunder Power. However, Playtika Holding Corp is 5.63 times less risky than Thunder Power. It trades about 0.19 of its potential returns per unit of risk. Thunder Power Holdings, is currently generating about -0.13 per unit of risk. If you would invest 793.00 in Playtika Holding Corp on August 31, 2024 and sell it today you would earn a total of 40.00 from holding Playtika Holding Corp or generate 5.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playtika Holding Corp vs. Thunder Power Holdings,
Performance |
| Timeline |
| Playtika Holding Corp |
| Thunder Power Holdings, |
Playtika Holding and Thunder Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playtika Holding and Thunder Power
The main advantage of trading using opposite Playtika Holding and Thunder Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtika Holding position performs unexpectedly, Thunder Power 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 Thunder Power will offset losses from the drop in Thunder Power's long position.| Playtika Holding vs. Doubledown Interactive Co | Playtika Holding vs. SohuCom | Playtika Holding vs. Playstudios | Playtika Holding vs. GDEV Inc |
| Thunder Power vs. HNI Corp | Thunder Power vs. Merit Medical Systems | Thunder Power vs. Nike Inc | Thunder Power vs. NioCorp Developments Ltd |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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