Correlation Between Parks America and Plby
Can any of the company-specific risk be diversified away by investing in both Parks America and Plby 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 Parks America and Plby into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Parks America and Plby Group, you can compare the effects of market volatilities on Parks America and Plby 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 Parks America with a short position of Plby. Check out your portfolio center. Please also check ongoing floating volatility patterns of Parks America and Plby.
Diversification Opportunities for Parks America and Plby
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Parks and Plby is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Parks America and Plby Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plby Group and Parks America 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 Parks America are associated (or correlated) with Plby. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plby Group has no effect on the direction of Parks America i.e., Parks America and Plby go up and down completely randomly.
Pair Corralation between Parks America and Plby
Given the investment horizon of 90 days Parks America is expected to generate 1.75 times less return on investment than Plby. But when comparing it to its historical volatility, Parks America is 1.24 times less risky than Plby. It trades about 0.06 of its potential returns per unit of risk. Plby Group is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 64.00 in Plby Group on September 2, 2024 and sell it today you would earn a total of 74.00 from holding Plby Group or generate 115.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Parks America vs. Plby Group
Performance |
| Timeline |
| Parks America |
| Plby Group |
Parks America and Plby Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Parks America and Plby
The main advantage of trading using opposite Parks America and Plby positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Parks America position performs unexpectedly, Plby 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 Plby will offset losses from the drop in Plby's long position.| Parks America vs. Porsche Automobile Holding | Parks America vs. Ferrari NV | Parks America vs. Toyota Motor | Parks America vs. General Motors |
| Plby vs. Purecycle Technologies Holdings | Plby vs. Dolphin Entertainment | Plby vs. Hall of Fame | Plby vs. Funko Inc |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |