Correlation Between Roblox Corp and Activision Blizzard

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

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

Diversification Opportunities for Roblox Corp and Activision Blizzard

0.0

Correlation Coefficient

Roblox Corp  Activision Blizzard

Pay attention - limited upside

The 3 months correlation between Roblox and Activision is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Roblox Corp and Activision Blizzard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Activision Blizzard and Roblox Corp 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 Roblox Corp are associated (or correlated) with Activision Blizzard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Activision Blizzard has no effect on the direction of Roblox Corp i.e., Roblox Corp and Activision Blizzard go up and down completely randomly.

Pair Corralation between Roblox Corp and Activision Blizzard

If you would invest  5,848  in Roblox Corp on December 30, 2024 and sell it today you would earn a total of  59.00  from holding Roblox Corp or generate 1.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Roblox Corp  vs.  Activision Blizzard

Roblox Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Roblox Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong essential indicators, Roblox Corp is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Activision Blizzard

Risk-Adjusted Performance

Very Weak

Over the last 90 days Activision Blizzard has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Activision Blizzard is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Roblox Corp and Activision Blizzard

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

The idea behind Roblox Corp and Activision Blizzard 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..