Correlation Between Abcellera Biologics and Playtika Holding

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

By analyzing existing cross correlation between Abcellera Biologics and Playtika Holding Corp, you can compare the effects of market volatilities on Abcellera Biologics 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 Abcellera Biologics with a short position of Playtika Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abcellera Biologics and Playtika Holding.

Diversification Opportunities for Abcellera Biologics and Playtika Holding

-0.03

Correlation Coefficient

Abcellera Biologics  Playtika Holding

Good diversification

The 3 months correlation between Abcellera and Playtika is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Abcellera Biologics 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 Abcellera Biologics 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 Abcellera Biologics 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 Abcellera Biologics i.e., Abcellera Biologics and Playtika Holding go up and down completely randomly.

Pair Corralation between Abcellera Biologics and Playtika Holding

Given the investment horizon of 90 days Abcellera Biologics is expected to generate 1.86 times more return on investment than Playtika Holding. However, Abcellera Biologics is 1.86 times more volatile than Playtika Holding Corp. It trades about -0.01 of its potential returns per unit of risk. Playtika Holding Corp is currently generating about -0.24 per unit of risk. If you would invest  315.00  in Abcellera Biologics on October 10, 2024 and sell it today you would lose (12.00) from holding Abcellera Biologics or give up 3.81% of portfolio value over 90 days.

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

Abcellera Biologics  vs.  Playtika Holding Corp

Abcellera Biologics

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Abcellera Biologics are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental indicators, Abcellera Biologics disclosed solid returns over the last few months and may actually be approaching a breakup point.

Playtika Holding Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Playtika Holding Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Playtika Holding is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Abcellera Biologics and Playtika Holding

The main advantage of trading using opposite Abcellera Biologics and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abcellera Biologics 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.

The idea behind Abcellera Biologics and Playtika Holding Corp 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.