Correlation Between Accel Entertainment and Codere Online

Can any of the company-specific risk be diversified away by investing in both Accel Entertainment and Codere Online 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 Accel Entertainment and Codere Online into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Accel Entertainment and Codere Online Corp, you can compare the effects of market volatilities on Accel Entertainment and Codere Online 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 Accel Entertainment with a short position of Codere Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accel Entertainment and Codere Online.

Diversification Opportunities for Accel Entertainment and Codere Online

0.07

Correlation Coefficient

Accel Entertainment  Codere Online

Significant diversification

The 3 months correlation between Accel and Codere is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Accel Entertainment and Codere Online Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codere Online Corp and Accel Entertainment 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 Accel Entertainment are associated (or correlated) with Codere Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codere Online Corp has no effect on the direction of Accel Entertainment i.e., Accel Entertainment and Codere Online go up and down completely randomly.

Pair Corralation between Accel Entertainment and Codere Online

Given the investment horizon of 90 days Accel Entertainment is expected to generate 49.17 times less return on investment than Codere Online. But when comparing it to its historical volatility, Accel Entertainment is 1.57 times less risky than Codere Online. It trades about 0.0 of its potential returns per unit of risk. Codere Online Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  756.00  in Codere Online Corp on August 30, 2024 and sell it today you would earn a total of  4.00  from holding Codere Online Corp or generate 0.53% return on investment over 90 days.

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

Accel Entertainment  vs.  Codere Online Corp

Accel Entertainment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Accel Entertainment has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Accel Entertainment is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Codere Online Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Codere Online Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Codere Online is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Accel Entertainment and Codere Online

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

The idea behind Accel Entertainment and Codere Online 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.