Correlation Between ACCSYS TECHPLC and Discover Financial

Can any of the company-specific risk be diversified away by investing in both ACCSYS TECHPLC and Discover Financial 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 ACCSYS TECHPLC and Discover Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ACCSYS TECHPLC EO and Discover Financial Services, you can compare the effects of market volatilities on ACCSYS TECHPLC and Discover Financial 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 ACCSYS TECHPLC with a short position of Discover Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACCSYS TECHPLC and Discover Financial.

Diversification Opportunities for ACCSYS TECHPLC and Discover Financial

-0.68

Correlation Coefficient

ACCSYS TECHPLC  Discover Financial

Excellent diversification

The 3 months correlation between ACCSYS and Discover is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding ACCSYS TECHPLC EO and Discover Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Discover Financial and ACCSYS TECHPLC 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 ACCSYS TECHPLC EO are associated (or correlated) with Discover Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Discover Financial has no effect on the direction of ACCSYS TECHPLC i.e., ACCSYS TECHPLC and Discover Financial go up and down completely randomly.

Pair Corralation between ACCSYS TECHPLC and Discover Financial

Assuming the 90 days horizon ACCSYS TECHPLC EO is expected to generate 1.97 times more return on investment than Discover Financial. However, ACCSYS TECHPLC is 1.97 times more volatile than Discover Financial Services. It trades about 0.07 of its potential returns per unit of risk. Discover Financial Services is currently generating about -0.13 per unit of risk. If you would invest  50.00  in ACCSYS TECHPLC EO on December 4, 2024 and sell it today you would earn a total of  2.00  from holding ACCSYS TECHPLC EO or generate 4.0% return on investment over 90 days.

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

ACCSYS TECHPLC EO  vs.  Discover Financial Services

ACCSYS TECHPLC EO

Risk-Adjusted Performance

Very Weak

Over the last 90 days ACCSYS TECHPLC EO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ACCSYS TECHPLC is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Discover Financial

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Discover Financial Services are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Discover Financial may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with ACCSYS TECHPLC and Discover Financial

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

The idea behind ACCSYS TECHPLC EO and Discover Financial Services 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.

Check out your portfolio center.

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.