Correlation Between Playtika Holding and CAVA Group,

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Can any of the company-specific risk be diversified away by investing in both Playtika Holding and CAVA Group, 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 CAVA Group, 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 CAVA Group,, you can compare the effects of market volatilities on Playtika Holding and CAVA Group, 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 CAVA Group,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and CAVA Group,.

Diversification Opportunities for Playtika Holding and CAVA Group,

0.74
  Correlation Coefficient

Poor diversification

The 3 months correlation between Playtika and CAVA is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and CAVA Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAVA Group, 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 CAVA Group,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAVA Group, has no effect on the direction of Playtika Holding i.e., Playtika Holding and CAVA Group, go up and down completely randomly.

Pair Corralation between Playtika Holding and CAVA Group,

Given the investment horizon of 90 days Playtika Holding is expected to generate 93.19 times less return on investment than CAVA Group,. But when comparing it to its historical volatility, Playtika Holding Corp is 20.64 times less risky than CAVA Group,. It trades about 0.01 of its potential returns per unit of risk. CAVA Group, is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  0.00  in CAVA Group, on August 30, 2024 and sell it today you would earn a total of  14,120  from holding CAVA Group, or generate 9.223372036854776E16% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy74.34%
ValuesDaily Returns

Playtika Holding Corp  vs.  CAVA Group,

 Performance 
       Timeline  
Playtika Holding Corp 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Playtika Holding Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent basic indicators, Playtika Holding may actually be approaching a critical reversion point that can send shares even higher in December 2024.
CAVA Group, 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in CAVA Group, are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting basic indicators, CAVA Group, sustained solid returns over the last few months and may actually be approaching a breakup point.

Playtika Holding and CAVA Group, Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Playtika Holding and CAVA Group,

The main advantage of trading using opposite Playtika Holding and CAVA Group, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtika Holding position performs unexpectedly, CAVA Group, 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 CAVA Group, will offset losses from the drop in CAVA Group,'s long position.
The idea behind Playtika Holding Corp and CAVA Group, 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.
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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