Correlation Between Playtika Holding and Thor Industries
Can any of the company-specific risk be diversified away by investing in both Playtika Holding and Thor Industries 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 Thor Industries 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 Thor Industries, you can compare the effects of market volatilities on Playtika Holding and Thor Industries 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 Thor Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and Thor Industries.
Diversification Opportunities for Playtika Holding and Thor Industries
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Playtika and Thor is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and Thor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thor Industries 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 Thor Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thor Industries has no effect on the direction of Playtika Holding i.e., Playtika Holding and Thor Industries go up and down completely randomly.
Pair Corralation between Playtika Holding and Thor Industries
Given the investment horizon of 90 days Playtika Holding Corp is expected to under-perform the Thor Industries. In addition to that, Playtika Holding is 1.12 times more volatile than Thor Industries. It trades about -0.01 of its total potential returns per unit of risk. Thor Industries is currently generating about 0.04 per unit of volatility. If you would invest 9,155 in Thor Industries on August 31, 2024 and sell it today you would earn a total of 2,005 from holding Thor Industries or generate 21.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playtika Holding Corp vs. Thor Industries
Performance |
| Timeline |
| Playtika Holding Corp |
| Thor Industries |
Playtika Holding and Thor Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playtika Holding and Thor Industries
The main advantage of trading using opposite Playtika Holding and Thor Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtika Holding position performs unexpectedly, Thor Industries 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 Thor Industries will offset losses from the drop in Thor Industries' long position.| Playtika Holding vs. Doubledown Interactive Co | Playtika Holding vs. SohuCom | Playtika Holding vs. Playstudios | Playtika Holding vs. GDEV Inc |
| Thor Industries vs. Marine Products | Thor Industries vs. Malibu Boats | Thor Industries vs. Brunswick | Thor Industries vs. LCI Industries |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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