Correlation Between AutoNation and Accel Entertainment
Can any of the company-specific risk be diversified away by investing in both AutoNation and Accel Entertainment 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 AutoNation and Accel Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AutoNation and Accel Entertainment, you can compare the effects of market volatilities on AutoNation and Accel Entertainment 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 AutoNation with a short position of Accel Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of AutoNation and Accel Entertainment.
Diversification Opportunities for AutoNation and Accel Entertainment
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AutoNation and Accel is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding AutoNation and Accel Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accel Entertainment and AutoNation 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 AutoNation are associated (or correlated) with Accel Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accel Entertainment has no effect on the direction of AutoNation i.e., AutoNation and Accel Entertainment go up and down completely randomly.
Pair Corralation between AutoNation and Accel Entertainment
Allowing for the 90-day total investment horizon AutoNation is expected to generate 1.0 times less return on investment than Accel Entertainment. But when comparing it to its historical volatility, AutoNation is 1.09 times less risky than Accel Entertainment. It trades about 0.16 of its potential returns per unit of risk. Accel Entertainment is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,109 in Accel Entertainment on April 25, 2025 and sell it today you would earn a total of 168.00 from holding Accel Entertainment or generate 15.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AutoNation vs. Accel Entertainment
Performance |
| Timeline |
| AutoNation |
| Accel Entertainment |
AutoNation and Accel Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AutoNation and Accel Entertainment
The main advantage of trading using opposite AutoNation and Accel Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AutoNation position performs unexpectedly, Accel Entertainment 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 Accel Entertainment will offset losses from the drop in Accel Entertainment's long position.| AutoNation vs. Sonic Automotive | AutoNation vs. Lithia Motors | AutoNation vs. Asbury Automotive Group | AutoNation vs. Penske Automotive Group |
| Accel Entertainment vs. Ballys Corp | Accel Entertainment vs. Golden Entertainment | Accel Entertainment vs. Inspired Entertainment | Accel Entertainment vs. Light Wonder |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |