Correlation Between Ark Restaurants and Playtika Holding

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

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

Diversification Opportunities for Ark Restaurants and Playtika Holding

-0.15

Correlation Coefficient

Ark Restaurants  Playtika Holding

Good diversification

The 3 months correlation between Ark and Playtika is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Ark Restaurants Corp 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 Ark Restaurants 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 Ark Restaurants Corp 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 Ark Restaurants i.e., Ark Restaurants and Playtika Holding go up and down completely randomly.

Pair Corralation between Ark Restaurants and Playtika Holding

Given the investment horizon of 90 days Ark Restaurants Corp is expected to under-perform the Playtika Holding. In addition to that, Ark Restaurants is 1.07 times more volatile than Playtika Holding Corp. It trades about -0.01 of its total potential returns per unit of risk. Playtika Holding Corp is currently generating about 0.01 per unit of volatility. If you would invest  819.00  in Playtika Holding Corp on September 20, 2024 and sell it today you would lose (72.00) from holding Playtika Holding Corp or give up 8.79% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.79%
Values	Daily Returns

Ark Restaurants Corp  vs.  Playtika Holding Corp

Ark Restaurants Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ark Restaurants Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent performance, the Stock's forward-looking signals remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

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 Ark Restaurants and Playtika Holding

The main advantage of trading using opposite Ark Restaurants and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ark Restaurants 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 Ark Restaurants Corp 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.