Correlation Between Playtika Holding and Yuexiu Transport
Can any of the company-specific risk be diversified away by investing in both Playtika Holding and Yuexiu Transport 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 Yuexiu Transport 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 Yuexiu Transport Infrastructure, you can compare the effects of market volatilities on Playtika Holding and Yuexiu Transport 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 Yuexiu Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and Yuexiu Transport.
Diversification Opportunities for Playtika Holding and Yuexiu Transport
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Playtika and Yuexiu is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and Yuexiu Transport Infrastructur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuexiu Transport Inf 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 Yuexiu Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuexiu Transport Inf has no effect on the direction of Playtika Holding i.e., Playtika Holding and Yuexiu Transport go up and down completely randomly.
Pair Corralation between Playtika Holding and Yuexiu Transport
Given the investment horizon of 90 days Playtika Holding is expected to generate 3.83 times less return on investment than Yuexiu Transport. But when comparing it to its historical volatility, Playtika Holding Corp is 4.88 times less risky than Yuexiu Transport. It trades about 0.3 of its potential returns per unit of risk. Yuexiu Transport Infrastructure is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 45.00 in Yuexiu Transport Infrastructure on September 1, 2024 and sell it today you would earn a total of 13.00 from holding Yuexiu Transport Infrastructure or generate 28.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playtika Holding Corp vs. Yuexiu Transport Infrastructur
Performance |
| Timeline |
| Playtika Holding Corp |
| Yuexiu Transport Inf |
Playtika Holding and Yuexiu Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playtika Holding and Yuexiu Transport
The main advantage of trading using opposite Playtika Holding and Yuexiu Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtika Holding position performs unexpectedly, Yuexiu Transport 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 Yuexiu Transport will offset losses from the drop in Yuexiu Transport's long position.| Playtika Holding vs. Gravity Co | Playtika Holding vs. NetEase | Playtika Holding vs. Snail, Class A | Playtika Holding vs. GameSquare Holdings |
| Yuexiu Transport vs. Verra Mobility Corp | Yuexiu Transport vs. HUMANA INC | Yuexiu Transport vs. SCOR PK | Yuexiu Transport vs. Aquagold International |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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