Correlation Between CD Projekt and Playtika Holding

Can any of the company-specific risk be diversified away by investing in both CD Projekt 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 CD Projekt and Playtika Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for CD Projekt and Playtika Holding

-0.21

Correlation Coefficient

CD Projekt  Playtika Holding

Very good diversification

The 3 months correlation between OTGLF and Playtika is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding CD Projekt SA and Playtika Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Playtika Holding Corp and CD Projekt 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 CD Projekt SA 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 Corp has no effect on the direction of CD Projekt i.e., CD Projekt and Playtika Holding go up and down completely randomly.

Pair Corralation between CD Projekt and Playtika Holding

Assuming the 90 days horizon CD Projekt SA is expected to generate 0.9 times more return on investment than Playtika Holding. However, CD Projekt SA is 1.11 times less risky than Playtika Holding. It trades about 0.14 of its potential returns per unit of risk. Playtika Holding Corp is currently generating about -0.12 per unit of risk. If you would invest  5,777  in CD Projekt SA on May 5, 2025 and sell it today you would earn a total of  1,236  from holding CD Projekt SA or generate 21.4% return on investment over 90 days.

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

CD Projekt SA  vs.  Playtika Holding Corp

CD Projekt SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CD Projekt SA are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak essential indicators, CD Projekt reported solid returns over the last few months and may actually be approaching a breakup point.

Playtika Holding Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Playtika Holding Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in September 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with CD Projekt and Playtika Holding

The main advantage of trading using opposite CD Projekt and Playtika Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CD Projekt 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 CD Projekt SA and Playtika Holding Corp 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.