Correlation Between Nayax and Infosys
Can any of the company-specific risk be diversified away by investing in both Nayax and Infosys 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 Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nayax and Infosys Ltd ADR, you can compare the effects of market volatilities on Nayax and Infosys 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 Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nayax and Infosys.
Diversification Opportunities for Nayax and Infosys
Excellent diversification
The 3 months correlation between Nayax and Infosys is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Nayax and Infosys Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Ltd ADR 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 Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Ltd ADR has no effect on the direction of Nayax i.e., Nayax and Infosys go up and down completely randomly.
Pair Corralation between Nayax and Infosys
Given the investment horizon of 90 days Nayax is expected to generate 2.22 times more return on investment than Infosys. However, Nayax is 2.22 times more volatile than Infosys Ltd ADR. It trades about 0.08 of its potential returns per unit of risk. Infosys Ltd ADR is currently generating about 0.13 per unit of risk. If you would invest 2,841 in Nayax on August 30, 2024 and sell it today you would earn a total of 133.00 from holding Nayax or generate 4.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nayax vs. Infosys Ltd ADR
Performance |
| Timeline |
| Nayax |
| Infosys Ltd ADR |
Nayax and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nayax and Infosys
The main advantage of trading using opposite Nayax and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nayax position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.| Nayax vs. The Hackett Group | Nayax vs. CSP Inc | Nayax vs. Formula Systems 1985 | Nayax vs. Information Services Group |
| Infosys vs. The Hackett Group | Infosys vs. Nayax | Infosys vs. Formula Systems 1985 | Infosys vs. Information Services Group |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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