Correlation Between Genpact and First Advantage
Can any of the company-specific risk be diversified away by investing in both Genpact and First Advantage 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 First Advantage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genpact Limited and First Advantage Corp, you can compare the effects of market volatilities on Genpact and First Advantage 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 First Advantage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genpact and First Advantage.
Diversification Opportunities for Genpact and First Advantage
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Genpact and First is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Genpact Limited and First Advantage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Advantage Corp 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 First Advantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Advantage Corp has no effect on the direction of Genpact i.e., Genpact and First Advantage go up and down completely randomly.
Pair Corralation between Genpact and First Advantage
Taking into account the 90-day investment horizon Genpact Limited is expected to generate 0.61 times more return on investment than First Advantage. However, Genpact Limited is 1.64 times less risky than First Advantage. It trades about 0.55 of its potential returns per unit of risk. First Advantage Corp is currently generating about 0.06 per unit of risk. If you would invest 4,299 in Genpact Limited on November 2, 2024 and sell it today you would earn a total of 543.00 from holding Genpact Limited or generate 12.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genpact Limited vs. First Advantage Corp
Performance |
| Timeline |
| Genpact Limited |
| First Advantage Corp |
Genpact and First Advantage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genpact and First Advantage
The main advantage of trading using opposite Genpact and First Advantage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genpact position performs unexpectedly, First Advantage 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 First Advantage will offset losses from the drop in First Advantage's long position.| Genpact vs. WNS Holdings | Genpact vs. ASGN Inc | Genpact vs. CACI International | Genpact vs. ExlService Holdings |
| First Advantage vs. Discount Print USA | First Advantage vs. Cass Information Systems | First Advantage vs. Civeo Corp | First Advantage vs. Network 1 Technologies |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |