Correlation Between PLAYTIKA HOLDING and Walmart

Can any of the company-specific risk be diversified away by investing in both PLAYTIKA HOLDING and Walmart 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 Walmart 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 Walmart, you can compare the effects of market volatilities on PLAYTIKA HOLDING and Walmart 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 Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYTIKA HOLDING and Walmart.

Diversification Opportunities for PLAYTIKA HOLDING and Walmart

0.75

Correlation Coefficient

PLAYTIKA HOLDING  Walmart

Poor diversification

The 3 months correlation between PLAYTIKA and Walmart is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding PLAYTIKA HOLDING DL 01 and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart 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 Walmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walmart has no effect on the direction of PLAYTIKA HOLDING i.e., PLAYTIKA HOLDING and Walmart go up and down completely randomly.

Pair Corralation between PLAYTIKA HOLDING and Walmart

Assuming the 90 days horizon PLAYTIKA HOLDING DL 01 is expected to under-perform the Walmart. In addition to that, PLAYTIKA HOLDING is 1.59 times more volatile than Walmart. It trades about -0.29 of its total potential returns per unit of risk. Walmart is currently generating about -0.07 per unit of volatility. If you would invest  8,564  in Walmart on December 23, 2024 and sell it today you would lose (647.00) from holding Walmart or give up 7.55% of portfolio value over 90 days.

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

PLAYTIKA HOLDING DL 01  vs.  Walmart

PLAYTIKA HOLDING

Risk-Adjusted Performance

Very Weak

Over the last 90 days PLAYTIKA HOLDING DL 01 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Walmart

Risk-Adjusted Performance

Very Weak

Over the last 90 days Walmart has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with PLAYTIKA HOLDING and Walmart

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

The idea behind PLAYTIKA HOLDING DL 01 and Walmart 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.