Correlation Between PLAYTIKA HOLDING and EIDESVIK OFFSHORE

Can any of the company-specific risk be diversified away by investing in both PLAYTIKA HOLDING and EIDESVIK OFFSHORE 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 EIDESVIK OFFSHORE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PLAYTIKA HOLDING DL 01 and EIDESVIK OFFSHORE NK, you can compare the effects of market volatilities on PLAYTIKA HOLDING and EIDESVIK OFFSHORE 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 EIDESVIK OFFSHORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYTIKA HOLDING and EIDESVIK OFFSHORE.

Diversification Opportunities for PLAYTIKA HOLDING and EIDESVIK OFFSHORE

-0.73

Correlation Coefficient

PLAYTIKA HOLDING  EIDESVIK OFFSHORE

Pay attention - limited upside

The 3 months correlation between PLAYTIKA and EIDESVIK is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding PLAYTIKA HOLDING DL 01 and EIDESVIK OFFSHORE NK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EIDESVIK OFFSHORE 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 DL 01 are associated (or correlated) with EIDESVIK OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EIDESVIK OFFSHORE has no effect on the direction of PLAYTIKA HOLDING i.e., PLAYTIKA HOLDING and EIDESVIK OFFSHORE go up and down completely randomly.

Pair Corralation between PLAYTIKA HOLDING and EIDESVIK OFFSHORE

Assuming the 90 days horizon PLAYTIKA HOLDING DL 01 is expected to generate 0.9 times more return on investment than EIDESVIK OFFSHORE. However, PLAYTIKA HOLDING DL 01 is 1.12 times less risky than EIDESVIK OFFSHORE. It trades about 0.16 of its potential returns per unit of risk. EIDESVIK OFFSHORE NK is currently generating about -0.06 per unit of risk. If you would invest  646.00  in PLAYTIKA HOLDING DL 01 on September 12, 2024 and sell it today you would earn a total of  149.00  from holding PLAYTIKA HOLDING DL 01 or generate 23.07% return on investment over 90 days.

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

PLAYTIKA HOLDING DL 01  vs.  EIDESVIK OFFSHORE NK

PLAYTIKA HOLDING

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PLAYTIKA HOLDING DL 01 are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, PLAYTIKA HOLDING reported solid returns over the last few months and may actually be approaching a breakup point.

EIDESVIK OFFSHORE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EIDESVIK OFFSHORE NK has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with PLAYTIKA HOLDING and EIDESVIK OFFSHORE

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

The idea behind PLAYTIKA HOLDING DL 01 and EIDESVIK OFFSHORE NK 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.