Correlation Between Cognizant Technology and Wynn Resorts
Can any of the company-specific risk be diversified away by investing in both Cognizant Technology and Wynn Resorts 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 Cognizant Technology and Wynn Resorts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cognizant Technology Solutions and Wynn Resorts Limited, you can compare the effects of market volatilities on Cognizant Technology and Wynn Resorts 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 Cognizant Technology with a short position of Wynn Resorts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cognizant Technology and Wynn Resorts.
Diversification Opportunities for Cognizant Technology and Wynn Resorts
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cognizant and Wynn is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Cognizant Technology Solutions and Wynn Resorts Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wynn Resorts Limited and Cognizant Technology 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 Cognizant Technology Solutions are associated (or correlated) with Wynn Resorts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wynn Resorts Limited has no effect on the direction of Cognizant Technology i.e., Cognizant Technology and Wynn Resorts go up and down completely randomly.
Pair Corralation between Cognizant Technology and Wynn Resorts
If you would invest 171,703 in Wynn Resorts Limited on November 4, 2024 and sell it today you would earn a total of 7,897 from holding Wynn Resorts Limited or generate 4.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cognizant Technology Solutions vs. Wynn Resorts Limited
Performance |
| Timeline |
| Cognizant Technology |
| Wynn Resorts Limited |
Cognizant Technology and Wynn Resorts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cognizant Technology and Wynn Resorts
The main advantage of trading using opposite Cognizant Technology and Wynn Resorts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cognizant Technology position performs unexpectedly, Wynn Resorts 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 Wynn Resorts will offset losses from the drop in Wynn Resorts' long position.| Cognizant Technology vs. Capital One Financial | Cognizant Technology vs. Hoteles City Express | Cognizant Technology vs. DXC Technology | Cognizant Technology vs. GMxico Transportes SAB |
| Wynn Resorts vs. Las Vegas Sands | Wynn Resorts vs. Grupe SAB de | Wynn Resorts vs. CEMEX SAB de | Wynn Resorts vs. Procter Gamble DRC |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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