Correlation Between Accenture Plc and Nayax

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

By analyzing existing cross correlation between Accenture plc and Nayax, you can compare the effects of market volatilities on Accenture Plc and Nayax 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 Accenture Plc with a short position of Nayax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accenture Plc and Nayax.

Diversification Opportunities for Accenture Plc and Nayax

-0.15

Correlation Coefficient

Accenture Plc  Nayax

Good diversification

The 3 months correlation between Accenture and Nayax is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Accenture plc and Nayax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nayax and Accenture Plc 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 Accenture plc are associated (or correlated) with Nayax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nayax has no effect on the direction of Accenture Plc i.e., Accenture Plc and Nayax go up and down completely randomly.

Pair Corralation between Accenture Plc and Nayax

Considering the 90-day investment horizon Accenture Plc is expected to generate 1.92 times less return on investment than Nayax. But when comparing it to its historical volatility, Accenture plc is 2.05 times less risky than Nayax. It trades about 0.1 of its potential returns per unit of risk. Nayax is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,064  in Nayax on September 29, 2024 and sell it today you would earn a total of  714.00  from holding Nayax or generate 34.59% return on investment over 90 days.

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

Accenture plc  vs.  Nayax

Accenture plc

Risk-Adjusted Performance

1 of 100

Weak

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

Nayax

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nayax are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Nayax may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Accenture Plc and Nayax

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

The idea behind Accenture plc and Nayax 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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.