Correlation Between Genpact and Transportation Fund
Can any of the company-specific risk be diversified away by investing in both Genpact and Transportation Fund 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 Transportation Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genpact Limited and Transportation Fund Investor, you can compare the effects of market volatilities on Genpact and Transportation Fund 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 Transportation Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genpact and Transportation Fund.
Diversification Opportunities for Genpact and Transportation Fund
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Genpact and Transportation is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Genpact Limited and Transportation Fund Investor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transportation Fund 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 Transportation Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transportation Fund has no effect on the direction of Genpact i.e., Genpact and Transportation Fund go up and down completely randomly.
Pair Corralation between Genpact and Transportation Fund
Taking into account the 90-day investment horizon Genpact Limited is expected to generate 1.21 times more return on investment than Transportation Fund. However, Genpact is 1.21 times more volatile than Transportation Fund Investor. It trades about 0.01 of its potential returns per unit of risk. Transportation Fund Investor is currently generating about 0.02 per unit of risk. If you would invest 4,380 in Genpact Limited on August 26, 2024 and sell it today you would earn a total of 239.00 from holding Genpact Limited or generate 5.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genpact Limited vs. Transportation Fund Investor
Performance |
| Timeline |
| Genpact Limited |
| Transportation Fund |
Genpact and Transportation Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genpact and Transportation Fund
The main advantage of trading using opposite Genpact and Transportation Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genpact position performs unexpectedly, Transportation Fund 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 Transportation Fund will offset losses from the drop in Transportation Fund's long position.| Genpact vs. Oneconnect Financial Technology | Genpact vs. Global Business Travel | Genpact vs. Alight Inc | Genpact vs. CS Disco LLC |
| Transportation Fund vs. Barnes Group | Transportation Fund vs. Genpact Limited | Transportation Fund vs. Jacobs Solutions | Transportation Fund vs. Ryder System |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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