Correlation Between Playtika Holding and Nike
Can any of the company-specific risk be diversified away by investing in both Playtika Holding and Nike 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 Nike 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 Nike Inc, you can compare the effects of market volatilities on Playtika Holding and Nike 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 Nike. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and Nike.
Diversification Opportunities for Playtika Holding and Nike
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Playtika and Nike is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and Nike Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nike Inc 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 Nike. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nike Inc has no effect on the direction of Playtika Holding i.e., Playtika Holding and Nike go up and down completely randomly.
Pair Corralation between Playtika Holding and Nike
Given the investment horizon of 90 days Playtika Holding Corp is expected to generate 1.06 times more return on investment than Nike. However, Playtika Holding is 1.06 times more volatile than Nike Inc. It trades about 0.02 of its potential returns per unit of risk. Nike Inc is currently generating about -0.06 per unit of risk. If you would invest 809.00 in Playtika Holding Corp on September 2, 2024 and sell it today you would earn a total of 33.00 from holding Playtika Holding Corp or generate 4.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playtika Holding Corp vs. Nike Inc
Performance |
| Timeline |
| Playtika Holding Corp |
| Nike Inc |
Playtika Holding and Nike Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playtika Holding and Nike
The main advantage of trading using opposite Playtika Holding and Nike positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtika Holding position performs unexpectedly, Nike 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 Nike will offset losses from the drop in Nike's long position.| Playtika Holding vs. Gravity Co | Playtika Holding vs. NetEase | Playtika Holding vs. Snail, Class A | Playtika Holding vs. GameSquare Holdings |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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