Correlation Between ACCSYS TECHPLC and DOLFINES

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

Diversification Opportunities for ACCSYS TECHPLC and DOLFINES

-0.64

Correlation Coefficient

ACCSYS TECHPLC  DOLFINES

Excellent diversification

The 3 months correlation between ACCSYS and DOLFINES is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding ACCSYS TECHPLC EO and DOLFINES SA EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DOLFINES SA EO 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 DOLFINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DOLFINES SA EO has no effect on the direction of ACCSYS TECHPLC i.e., ACCSYS TECHPLC and DOLFINES go up and down completely randomly.

Pair Corralation between ACCSYS TECHPLC and DOLFINES

Assuming the 90 days horizon ACCSYS TECHPLC EO is expected to under-perform the DOLFINES. But the stock apears to be less risky and, when comparing its historical volatility, ACCSYS TECHPLC EO is 31.39 times less risky than DOLFINES. The stock trades about -0.03 of its potential returns per unit of risk. The DOLFINES SA EO is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  150.00  in DOLFINES SA EO on October 9, 2024 and sell it today you would lose (15.00) from holding DOLFINES SA EO or give up 10.0% of portfolio value over 90 days.

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

ACCSYS TECHPLC EO  vs.  DOLFINES SA EO

ACCSYS TECHPLC EO

Risk-Adjusted Performance

0 of 100

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 current stock price disturbance, may contribute to mid-run losses for the stockholders.

DOLFINES SA EO

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in DOLFINES SA EO are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, DOLFINES reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ACCSYS TECHPLC and DOLFINES

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

The idea behind ACCSYS TECHPLC EO and DOLFINES SA EO 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.