Correlation Between Playtech Plc and Planet Fitness
Can any of the company-specific risk be diversified away by investing in both Playtech Plc and Planet Fitness 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 Playtech Plc and Planet Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Playtech plc and Planet Fitness, you can compare the effects of market volatilities on Playtech Plc and Planet Fitness 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 Playtech Plc with a short position of Planet Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playtech Plc and Planet Fitness.
Diversification Opportunities for Playtech Plc and Planet Fitness
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Playtech and Planet is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Playtech plc and Planet Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Fitness and Playtech Plc 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 Playtech plc are associated (or correlated) with Planet Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet Fitness has no effect on the direction of Playtech Plc i.e., Playtech Plc and Planet Fitness go up and down completely randomly.
Pair Corralation between Playtech Plc and Planet Fitness
Assuming the 90 days horizon Playtech plc is expected to under-perform the Planet Fitness. But the pink sheet apears to be less risky and, when comparing its historical volatility, Playtech plc is 1.25 times less risky than Planet Fitness. The pink sheet trades about -0.07 of its potential returns per unit of risk. The Planet Fitness is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 9,958 in Planet Fitness on December 1, 2024 and sell it today you would lose (703.00) from holding Planet Fitness or give up 7.06% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Playtech plc vs. Planet Fitness
Performance |
Timeline |
Playtech plc |
Planet Fitness |
Playtech Plc and Planet Fitness Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Playtech Plc and Planet Fitness
The main advantage of trading using opposite Playtech Plc and Planet Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playtech Plc position performs unexpectedly, Planet Fitness 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 Planet Fitness will offset losses from the drop in Planet Fitness' long position.Playtech Plc vs. Data3 Limited | Playtech Plc vs. National Storage REIT | Playtech Plc vs. Asure Software | Playtech Plc vs. Uber Technologies |
Planet Fitness vs. Life Time Group | Planet Fitness vs. JAKKS Pacific | Planet Fitness vs. Six Flags Entertainment | Planet Fitness vs. Johnson Outdoors |
Check out your portfolio center.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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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