Correlation Between Accel Entertainment and Everi Holdings

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

By analyzing existing cross correlation between Accel Entertainment and Everi Holdings, you can compare the effects of market volatilities on Accel Entertainment and Everi Holdings 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 Everi Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accel Entertainment and Everi Holdings.

Diversification Opportunities for Accel Entertainment and Everi Holdings

0.51

Correlation Coefficient

Accel Entertainment  Everi Holdings

Very weak diversification

The 3 months correlation between Accel and Everi is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Accel Entertainment and Everi Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everi Holdings 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 Everi Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everi Holdings has no effect on the direction of Accel Entertainment i.e., Accel Entertainment and Everi Holdings go up and down completely randomly.

Pair Corralation between Accel Entertainment and Everi Holdings

Given the investment horizon of 90 days Accel Entertainment is expected to generate 5.43 times more return on investment than Everi Holdings. However, Accel Entertainment is 5.43 times more volatile than Everi Holdings. It trades about 0.05 of its potential returns per unit of risk. Everi Holdings is currently generating about 0.04 per unit of risk. If you would invest  1,036  in Accel Entertainment on January 12, 2025 and sell it today you would earn a total of  60.00  from holding Accel Entertainment or generate 5.79% return on investment over 90 days.

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

Accel Entertainment  vs.  Everi Holdings

Accel Entertainment

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Accel Entertainment are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite abnormal technical and fundamental indicators, Accel Entertainment may actually be approaching a critical reversion point that can send shares even higher in May 2025.

Everi Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Everi Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Everi Holdings is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Accel Entertainment and Everi Holdings

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

The idea behind Accel Entertainment and Everi 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.