Correlation Between PLAYTIKA HOLDING and Sankyo

Can any of the company-specific risk be diversified away by investing in both PLAYTIKA HOLDING and Sankyo 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 Sankyo into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PLAYTIKA HOLDING DL 01 and Sankyo Co, you can compare the effects of market volatilities on PLAYTIKA HOLDING and Sankyo 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 Sankyo. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYTIKA HOLDING and Sankyo.

Diversification Opportunities for PLAYTIKA HOLDING and Sankyo

0.2

Correlation Coefficient

PLAYTIKA HOLDING  Sankyo

Modest diversification

The 3 months correlation between PLAYTIKA and Sankyo is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding PLAYTIKA HOLDING DL 01 and Sankyo Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sankyo 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 DL 01 are associated (or correlated) with Sankyo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sankyo has no effect on the direction of PLAYTIKA HOLDING i.e., PLAYTIKA HOLDING and Sankyo go up and down completely randomly.

Pair Corralation between PLAYTIKA HOLDING and Sankyo

Assuming the 90 days horizon PLAYTIKA HOLDING DL 01 is expected to under-perform the Sankyo. In addition to that, PLAYTIKA HOLDING is 1.17 times more volatile than Sankyo Co. It trades about 0.0 of its total potential returns per unit of risk. Sankyo Co is currently generating about 0.06 per unit of volatility. If you would invest  728.00  in Sankyo Co on October 11, 2024 and sell it today you would earn a total of  562.00  from holding Sankyo Co or generate 77.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

PLAYTIKA HOLDING DL 01  vs.  Sankyo Co

PLAYTIKA HOLDING

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in PLAYTIKA HOLDING DL 01 are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, PLAYTIKA HOLDING is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Sankyo

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sankyo Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Sankyo is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with PLAYTIKA HOLDING and Sankyo

The main advantage of trading using opposite PLAYTIKA HOLDING and Sankyo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAYTIKA HOLDING position performs unexpectedly, Sankyo 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 Sankyo will offset losses from the drop in Sankyo's long position.

The idea behind PLAYTIKA HOLDING DL 01 and Sankyo Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.