Correlation Between Pixie Dust and Acco Brands

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

By analyzing existing cross correlation between Pixie Dust Technologies, and Acco Brands, you can compare the effects of market volatilities on Pixie Dust and Acco Brands 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 Pixie Dust with a short position of Acco Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pixie Dust and Acco Brands.

Diversification Opportunities for Pixie Dust and Acco Brands

0.6

Correlation Coefficient

Pixie Dust  Acco Brands

Poor diversification

The 3 months correlation between Pixie and Acco is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Pixie Dust Technologies, and Acco Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acco Brands and Pixie Dust 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 Pixie Dust Technologies, are associated (or correlated) with Acco Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acco Brands has no effect on the direction of Pixie Dust i.e., Pixie Dust and Acco Brands go up and down completely randomly.

Pair Corralation between Pixie Dust and Acco Brands

If you would invest  527.00  in Acco Brands on October 25, 2024 and sell it today you would earn a total of  2.00  from holding Acco Brands or generate 0.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	5.26%
Values	Daily Returns

Pixie Dust Technologies,  vs.  Acco Brands

Pixie Dust Technologies,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pixie Dust Technologies, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Pixie Dust is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Acco Brands

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Acco Brands are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Acco Brands displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pixie Dust and Acco Brands

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

The idea behind Pixie Dust Technologies, and Acco Brands 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.