Correlation Between Nayax and Grid Dynamics

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

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

Diversification Opportunities for Nayax and Grid Dynamics

0.15

Correlation Coefficient

Nayax  Grid Dynamics

Average diversification

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

Pair Corralation between Nayax and Grid Dynamics

Given the investment horizon of 90 days Nayax is expected to generate 0.85 times more return on investment than Grid Dynamics. However, Nayax is 1.17 times less risky than Grid Dynamics. It trades about 0.14 of its potential returns per unit of risk. Grid Dynamics Holdings is currently generating about -0.17 per unit of risk. If you would invest  2,778  in Nayax on December 27, 2024 and sell it today you would earn a total of  584.00  from holding Nayax or generate 21.02% return on investment over 90 days.

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

Nayax  vs.  Grid Dynamics Holdings

Nayax

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nayax are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Nayax showed solid returns over the last few months and may actually be approaching a breakup point.

Grid Dynamics Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Grid Dynamics Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Nayax and Grid Dynamics

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

The idea behind Nayax and Grid Dynamics Holdings 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.