Correlation Between DXC Technology and ASGN
Can any of the company-specific risk be diversified away by investing in both DXC Technology and ASGN 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 DXC Technology and ASGN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DXC Technology Co and ASGN Inc, you can compare the effects of market volatilities on DXC Technology and ASGN 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 DXC Technology with a short position of ASGN. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and ASGN.
Diversification Opportunities for DXC Technology and ASGN
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DXC and ASGN is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and ASGN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASGN Inc and DXC 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 DXC Technology Co are associated (or correlated) with ASGN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASGN Inc has no effect on the direction of DXC Technology i.e., DXC Technology and ASGN go up and down completely randomly.
Pair Corralation between DXC Technology and ASGN
Considering the 90-day investment horizon DXC Technology Co is expected to under-perform the ASGN. In addition to that, DXC Technology is 1.43 times more volatile than ASGN Inc. It trades about -0.01 of its total potential returns per unit of risk. ASGN Inc is currently generating about 0.0 per unit of volatility. If you would invest 9,572 in ASGN Inc on October 25, 2024 and sell it today you would lose (407.00) from holding ASGN Inc or give up 4.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DXC Technology Co vs. ASGN Inc
Performance |
| Timeline |
| DXC Technology |
| ASGN Inc |
DXC Technology and ASGN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DXC Technology and ASGN
The main advantage of trading using opposite DXC Technology and ASGN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DXC Technology position performs unexpectedly, ASGN 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 ASGN will offset losses from the drop in ASGN's long position.| DXC Technology vs. CACI International | DXC Technology vs. CDW Corp | DXC Technology vs. Jack Henry Associates | DXC Technology vs. Broadridge Financial Solutions |
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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