Correlation Between Genpact and Aspen Aerogels
Can any of the company-specific risk be diversified away by investing in both Genpact and Aspen Aerogels 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 Genpact and Aspen Aerogels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genpact Limited and Aspen Aerogels, you can compare the effects of market volatilities on Genpact and Aspen Aerogels 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 Genpact with a short position of Aspen Aerogels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genpact and Aspen Aerogels.
Diversification Opportunities for Genpact and Aspen Aerogels
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Genpact and Aspen is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Genpact Limited and Aspen Aerogels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspen Aerogels and Genpact 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 Genpact Limited are associated (or correlated) with Aspen Aerogels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspen Aerogels has no effect on the direction of Genpact i.e., Genpact and Aspen Aerogels go up and down completely randomly.
Pair Corralation between Genpact and Aspen Aerogels
Taking into account the 90-day investment horizon Genpact Limited is expected to generate 0.72 times more return on investment than Aspen Aerogels. However, Genpact Limited is 1.39 times less risky than Aspen Aerogels. It trades about 0.37 of its potential returns per unit of risk. Aspen Aerogels is currently generating about -0.4 per unit of risk. If you would invest 3,830 in Genpact Limited on August 27, 2024 and sell it today you would earn a total of 789.00 from holding Genpact Limited or generate 20.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genpact Limited vs. Aspen Aerogels
Performance |
| Timeline |
| Genpact Limited |
| Aspen Aerogels |
Genpact and Aspen Aerogels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genpact and Aspen Aerogels
The main advantage of trading using opposite Genpact and Aspen Aerogels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genpact position performs unexpectedly, Aspen Aerogels 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 Aspen Aerogels will offset losses from the drop in Aspen Aerogels' long position.| Genpact vs. Oneconnect Financial Technology | Genpact vs. Global Business Travel | Genpact vs. Alight Inc | Genpact vs. CS Disco LLC |
| Aspen Aerogels vs. Apyx Medical | Aspen Aerogels vs. Century Communities | Aspen Aerogels vs. Ardmore Shpng | Aspen Aerogels vs. American Assets Trust |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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