Correlation Between Hanover Insurance and Playtika Holding
Can any of the company-specific risk be diversified away by investing in both Hanover Insurance 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 Hanover Insurance and Playtika Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hanover Insurance and Playtika Holding Corp, you can compare the effects of market volatilities on Hanover Insurance 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 Hanover Insurance with a short position of Playtika Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanover Insurance and Playtika Holding.
Diversification Opportunities for Hanover Insurance and Playtika Holding
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hanover and Playtika is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding The Hanover Insurance 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 Hanover Insurance 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 The Hanover Insurance 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 Hanover Insurance i.e., Hanover Insurance and Playtika Holding go up and down completely randomly.
Pair Corralation between Hanover Insurance and Playtika Holding
Considering the 90-day investment horizon The Hanover Insurance is expected to under-perform the Playtika Holding. But the stock apears to be less risky and, when comparing its historical volatility, The Hanover Insurance is 1.3 times less risky than Playtika Holding. The stock trades about -0.23 of its potential returns per unit of risk. The Playtika Holding Corp is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 855.00 in Playtika Holding Corp on September 13, 2024 and sell it today you would lose (28.00) from holding Playtika Holding Corp or give up 3.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Hanover Insurance vs. Playtika Holding Corp
Performance |
| Timeline |
| Hanover Insurance |
| Playtika Holding Corp |
Hanover Insurance and Playtika Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanover Insurance and Playtika Holding
The main advantage of trading using opposite Hanover Insurance and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanover Insurance 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.| Hanover Insurance vs. Horace Mann Educators | Hanover Insurance vs. Kemper | Hanover Insurance vs. RLI Corp | Hanover Insurance vs. Global Indemnity PLC |
| Playtika Holding vs. SohuCom | Playtika Holding vs. Playstudios | Playtika Holding vs. NetEase | Playtika Holding vs. Golden Matrix Group |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |