Correlation Between Playtika Holding and American Virtual

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

By analyzing existing cross correlation between Playtika Holding Corp and American Virtual Cloud, you can compare the effects of market volatilities on Playtika Holding and American Virtual 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 American Virtual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and American Virtual.

Diversification Opportunities for Playtika Holding and American Virtual

-0.44

Correlation Coefficient

Playtika Holding  American Virtual

Very good diversification

The 3 months correlation between Playtika and American is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and American Virtual Cloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Virtual Cloud 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 Corp are associated (or correlated) with American Virtual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Virtual Cloud has no effect on the direction of Playtika Holding i.e., Playtika Holding and American Virtual go up and down completely randomly.

Pair Corralation between Playtika Holding and American Virtual

If you would invest  759.00  in Playtika Holding Corp on September 14, 2024 and sell it today you would earn a total of  4.50  from holding Playtika Holding Corp or generate 0.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

Playtika Holding Corp  vs.  American Virtual Cloud

Playtika Holding Corp

Risk-Adjusted Performance

1 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Playtika Holding Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. 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.

American Virtual Cloud

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days American Virtual Cloud has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, American Virtual is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Playtika Holding and American Virtual

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

The idea behind Playtika Holding Corp and American Virtual Cloud 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.