Correlation Between Takara Holdings and PLAYTIKA HOLDING

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

By analyzing existing cross correlation between Takara Holdings and PLAYTIKA HOLDING DL 01, you can compare the effects of market volatilities on Takara Holdings and PLAYTIKA HOLDING 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 Takara Holdings with a short position of PLAYTIKA HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Takara Holdings and PLAYTIKA HOLDING.

Diversification Opportunities for Takara Holdings and PLAYTIKA HOLDING

-0.09

Correlation Coefficient

Takara Holdings  PLAYTIKA HOLDING

Good diversification

The 3 months correlation between Takara and PLAYTIKA is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Takara Holdings and PLAYTIKA HOLDING DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAYTIKA HOLDING and Takara Holdings 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 Takara Holdings are associated (or correlated) with PLAYTIKA HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAYTIKA HOLDING has no effect on the direction of Takara Holdings i.e., Takara Holdings and PLAYTIKA HOLDING go up and down completely randomly.

Pair Corralation between Takara Holdings and PLAYTIKA HOLDING

Assuming the 90 days horizon Takara Holdings is expected to generate 1.89 times less return on investment than PLAYTIKA HOLDING. But when comparing it to its historical volatility, Takara Holdings is 1.48 times less risky than PLAYTIKA HOLDING. It trades about 0.1 of its potential returns per unit of risk. PLAYTIKA HOLDING DL 01 is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  661.00  in PLAYTIKA HOLDING DL 01 on September 3, 2024 and sell it today you would earn a total of  119.00  from holding PLAYTIKA HOLDING DL 01 or generate 18.0% return on investment over 90 days.

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

Takara Holdings  vs.  PLAYTIKA HOLDING DL 01

Takara Holdings

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Takara Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Takara Holdings may actually be approaching a critical reversion point that can send shares even higher in January 2025.

PLAYTIKA HOLDING

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PLAYTIKA HOLDING DL 01 are ranked lower than 10 (%) 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.

Pair Trading with Takara Holdings and PLAYTIKA HOLDING

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

The idea behind Takara Holdings and PLAYTIKA HOLDING DL 01 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 Transaction History module to view history of all your transactions and understand their impact on performance.