Correlation Between RCS MediaGroup and Playtika Holding
Can any of the company-specific risk be diversified away by investing in both RCS MediaGroup and Playtika Holding 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 RCS MediaGroup and Playtika Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RCS MediaGroup SpA and Playtika Holding Corp, you can compare the effects of market volatilities on RCS MediaGroup and Playtika Holding 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 RCS MediaGroup with a short position of Playtika Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of RCS MediaGroup and Playtika Holding.
Diversification Opportunities for RCS MediaGroup and Playtika Holding
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between RCS and Playtika is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding RCS MediaGroup SpA and Playtika Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Playtika Holding Corp and RCS MediaGroup 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 RCS MediaGroup SpA are associated (or correlated) with Playtika Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Playtika Holding Corp has no effect on the direction of RCS MediaGroup i.e., RCS MediaGroup and Playtika Holding go up and down completely randomly.
Pair Corralation between RCS MediaGroup and Playtika Holding
Assuming the 90 days horizon RCS MediaGroup SpA is expected to generate 0.32 times more return on investment than Playtika Holding. However, RCS MediaGroup SpA is 3.17 times less risky than Playtika Holding. It trades about 0.08 of its potential returns per unit of risk. Playtika Holding Corp is currently generating about -0.37 per unit of risk. If you would invest 92.00 in RCS MediaGroup SpA on December 1, 2024 and sell it today you would earn a total of 2.00 from holding RCS MediaGroup SpA or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
RCS MediaGroup SpA vs. Playtika Holding Corp
Performance |
| Timeline |
| RCS MediaGroup SpA |
| Playtika Holding Corp |
RCS MediaGroup and Playtika Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RCS MediaGroup and Playtika Holding
The main advantage of trading using opposite RCS MediaGroup and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RCS MediaGroup position performs unexpectedly, Playtika Holding 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 Playtika Holding will offset losses from the drop in Playtika Holding's long position.| RCS MediaGroup vs. Legible | RCS MediaGroup vs. Sylvania Platinum Limited | RCS MediaGroup vs. Thunderbird Entertainment Group | RCS MediaGroup vs. PAX Global Technology |
| Playtika Holding vs. Doubledown Interactive Co | Playtika Holding vs. SohuCom | Playtika Holding vs. Playstudios | Playtika Holding vs. GDEV 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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