Correlation Between PLAYTIKA HOLDING and ARISTOCRAT LEISURE

Can any of the company-specific risk be diversified away by investing in both PLAYTIKA HOLDING and ARISTOCRAT LEISURE 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 ARISTOCRAT LEISURE 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 ARISTOCRAT LEISURE, you can compare the effects of market volatilities on PLAYTIKA HOLDING and ARISTOCRAT LEISURE 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 ARISTOCRAT LEISURE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYTIKA HOLDING and ARISTOCRAT LEISURE.

Diversification Opportunities for PLAYTIKA HOLDING and ARISTOCRAT LEISURE

0.27

Correlation Coefficient

PLAYTIKA HOLDING  ARISTOCRAT LEISURE

Modest diversification

The 3 months correlation between PLAYTIKA and ARISTOCRAT is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding PLAYTIKA HOLDING DL 01 and ARISTOCRAT LEISURE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ARISTOCRAT LEISURE 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 ARISTOCRAT LEISURE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ARISTOCRAT LEISURE has no effect on the direction of PLAYTIKA HOLDING i.e., PLAYTIKA HOLDING and ARISTOCRAT LEISURE go up and down completely randomly.

Pair Corralation between PLAYTIKA HOLDING and ARISTOCRAT LEISURE

Assuming the 90 days horizon PLAYTIKA HOLDING DL 01 is expected to under-perform the ARISTOCRAT LEISURE. In addition to that, PLAYTIKA HOLDING is 2.04 times more volatile than ARISTOCRAT LEISURE. It trades about -0.04 of its total potential returns per unit of risk. ARISTOCRAT LEISURE is currently generating about 0.07 per unit of volatility. If you would invest  3,594  in ARISTOCRAT LEISURE on April 23, 2025 and sell it today you would earn a total of  186.00  from holding ARISTOCRAT LEISURE or generate 5.18% return on investment over 90 days.

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

PLAYTIKA HOLDING DL 01  vs.  ARISTOCRAT LEISURE

PLAYTIKA HOLDING

Risk-Adjusted Performance

Very Weak

Over the last 90 days PLAYTIKA HOLDING DL 01 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile 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.

ARISTOCRAT LEISURE

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ARISTOCRAT LEISURE are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, ARISTOCRAT LEISURE is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with PLAYTIKA HOLDING and ARISTOCRAT LEISURE

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

The idea behind PLAYTIKA HOLDING DL 01 and ARISTOCRAT LEISURE 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.