Correlation Between Genpact and Insperity
Can any of the company-specific risk be diversified away by investing in both Genpact and Insperity 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 Insperity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genpact Limited and Insperity, you can compare the effects of market volatilities on Genpact and Insperity 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 Insperity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genpact and Insperity.
Diversification Opportunities for Genpact and Insperity
Excellent diversification
The 3 months correlation between Genpact and Insperity is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Genpact Limited and Insperity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insperity 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 Insperity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insperity has no effect on the direction of Genpact i.e., Genpact and Insperity go up and down completely randomly.
Pair Corralation between Genpact and Insperity
Taking into account the 90-day investment horizon Genpact Limited is expected to generate 0.84 times more return on investment than Insperity. However, Genpact Limited is 1.19 times less risky than Insperity. It trades about 0.05 of its potential returns per unit of risk. Insperity is currently generating about -0.01 per unit of risk. If you would invest 3,540 in Genpact Limited on September 12, 2024 and sell it today you would earn a total of 955.50 from holding Genpact Limited or generate 26.99% 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. Insperity
Performance |
| Timeline |
| Genpact Limited |
| Insperity |
Genpact and Insperity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genpact and Insperity
The main advantage of trading using opposite Genpact and Insperity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genpact position performs unexpectedly, Insperity 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 Insperity will offset losses from the drop in Insperity's long position.| Genpact vs. WNS Holdings | Genpact vs. ASGN Inc | Genpact vs. CACI International | Genpact vs. ExlService Holdings |
| Insperity vs. Korn Ferry | Insperity vs. Barrett Business Services | Insperity vs. TrueBlue | Insperity vs. Heidrick Struggles International |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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