Correlation Between Playtika Holding and Trump Media

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

Diversification Opportunities for Playtika Holding and Trump Media

0.4

Correlation Coefficient

Playtika Holding  Trump Media

Very weak diversification

The 3 months correlation between Playtika and Trump is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and Trump Media Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trump Media Technology 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 Trump Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trump Media Technology has no effect on the direction of Playtika Holding i.e., Playtika Holding and Trump Media go up and down completely randomly.

Pair Corralation between Playtika Holding and Trump Media

Given the investment horizon of 90 days Playtika Holding Corp is expected to generate 0.4 times more return on investment than Trump Media. However, Playtika Holding Corp is 2.49 times less risky than Trump Media. It trades about -0.21 of its potential returns per unit of risk. Trump Media Technology is currently generating about -0.1 per unit of risk. If you would invest  685.00  in Playtika Holding Corp on December 20, 2024 and sell it today you would lose (229.00) from holding Playtika Holding Corp or give up 33.43% of portfolio value over 90 days.

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

Playtika Holding Corp  vs.  Trump Media Technology

Playtika Holding Corp

Risk-Adjusted Performance

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 inconsistent performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Trump Media Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Trump Media Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Playtika Holding and Trump Media

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

The idea behind Playtika Holding Corp and Trump Media Technology 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.