Correlation Between Playtika Holding and 502413BE6

Can any of the company-specific risk be diversified away by investing in both Playtika Holding and 502413BE6 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 502413BE6 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 L3 TECHNOLOGIES INC, you can compare the effects of market volatilities on Playtika Holding and 502413BE6 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 502413BE6. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtika Holding and 502413BE6.

Diversification Opportunities for Playtika Holding and 502413BE6

-0.45

Correlation Coefficient

Playtika Holding  502413BE6

Very good diversification

The 3 months correlation between Playtika and 502413BE6 is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Playtika Holding Corp and L3 TECHNOLOGIES INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on L3 TECHNOLOGIES INC 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 502413BE6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of L3 TECHNOLOGIES INC has no effect on the direction of Playtika Holding i.e., Playtika Holding and 502413BE6 go up and down completely randomly.

Pair Corralation between Playtika Holding and 502413BE6

Given the investment horizon of 90 days Playtika Holding Corp is expected to under-perform the 502413BE6. In addition to that, Playtika Holding is 3.49 times more volatile than L3 TECHNOLOGIES INC. It trades about -0.18 of its total potential returns per unit of risk. L3 TECHNOLOGIES INC is currently generating about 0.35 per unit of volatility. If you would invest  9,608  in L3 TECHNOLOGIES INC on December 25, 2024 and sell it today you would earn a total of  266.00  from holding L3 TECHNOLOGIES INC or generate 2.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	13.56%
Values	Daily Returns

Playtika Holding Corp  vs.  L3 TECHNOLOGIES INC

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.

L3 TECHNOLOGIES INC

Risk-Adjusted Performance

Strong

Over the last 90 days L3 TECHNOLOGIES INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat conflicting basic indicators, 502413BE6 sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Playtika Holding and 502413BE6

The main advantage of trading using opposite Playtika Holding and 502413BE6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtika Holding position performs unexpectedly, 502413BE6 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 502413BE6 will offset losses from the drop in 502413BE6's long position.

The idea behind Playtika Holding Corp and L3 TECHNOLOGIES INC 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.