Correlation Between Play2Chill and Votum SA

Can any of the company-specific risk be diversified away by investing in both Play2Chill and Votum SA 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 Play2Chill and Votum SA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Play2Chill SA and Votum SA, you can compare the effects of market volatilities on Play2Chill and Votum SA 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 Play2Chill with a short position of Votum SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Play2Chill and Votum SA.

Diversification Opportunities for Play2Chill and Votum SA

-0.77

Correlation Coefficient

Play2Chill  Votum SA

Pay attention - limited upside

The 3 months correlation between Play2Chill and Votum is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Play2Chill SA and Votum SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Votum SA and Play2Chill 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 Play2Chill SA are associated (or correlated) with Votum SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Votum SA has no effect on the direction of Play2Chill i.e., Play2Chill and Votum SA go up and down completely randomly.

Pair Corralation between Play2Chill and Votum SA

If you would invest (100.00) in Votum SA on December 2, 2024 and sell it today you would earn a total of  100.00  from holding Votum SA or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	0.0%
Values	Daily Returns

Play2Chill SA  vs.  Votum SA

Play2Chill SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Play2Chill SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Votum SA

Risk-Adjusted Performance

OK

Over the last 90 days Votum SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively weak basic indicators, Votum SA reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Play2Chill and Votum SA

The main advantage of trading using opposite Play2Chill and Votum SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Play2Chill position performs unexpectedly, Votum SA 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 Votum SA will offset losses from the drop in Votum SA's long position.

The idea behind Play2Chill SA and Votum SA 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.