Correlation Between Accel Entertainment and Light Wonder
Can any of the company-specific risk be diversified away by investing in both Accel Entertainment and Light Wonder 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 Light Wonder into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Accel Entertainment and Light Wonder, you can compare the effects of market volatilities on Accel Entertainment and Light Wonder 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 Light Wonder. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accel Entertainment and Light Wonder.
Diversification Opportunities for Accel Entertainment and Light Wonder
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Accel and Light is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Accel Entertainment and Light Wonder in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Light Wonder 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 Light Wonder. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Light Wonder has no effect on the direction of Accel Entertainment i.e., Accel Entertainment and Light Wonder go up and down completely randomly.
Pair Corralation between Accel Entertainment and Light Wonder
Given the investment horizon of 90 days Accel Entertainment is expected to generate 0.61 times more return on investment than Light Wonder. However, Accel Entertainment is 1.64 times less risky than Light Wonder. It trades about 0.36 of its potential returns per unit of risk. Light Wonder is currently generating about 0.13 per unit of risk. If you would invest 1,072 in Accel Entertainment on November 18, 2024 and sell it today you would earn a total of 150.00 from holding Accel Entertainment or generate 13.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Accel Entertainment vs. Light Wonder
Performance |
| Timeline |
| Accel Entertainment |
| Light Wonder |
Accel Entertainment and Light Wonder Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Accel Entertainment and Light Wonder
The main advantage of trading using opposite Accel Entertainment and Light Wonder positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accel Entertainment position performs unexpectedly, Light Wonder 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 Light Wonder will offset losses from the drop in Light Wonder's long position.| Accel Entertainment vs. Light Wonder | Accel Entertainment vs. Everi Holdings | Accel Entertainment vs. Inspired Entertainment | Accel Entertainment vs. International Game Technology |
| Light Wonder vs. Codere Online Corp | Light Wonder vs. Inspired Entertainment | Light Wonder vs. International Game Technology | Light Wonder vs. Accel Entertainment |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |