Correlation Between Genpact and TELUS International
Can any of the company-specific risk be diversified away by investing in both Genpact and TELUS International 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 TELUS International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genpact Limited and TELUS International, you can compare the effects of market volatilities on Genpact and TELUS International 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 TELUS International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genpact and TELUS International.
Diversification Opportunities for Genpact and TELUS International
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Genpact and TELUS is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Genpact Limited and TELUS International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TELUS International 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 TELUS International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TELUS International has no effect on the direction of Genpact i.e., Genpact and TELUS International go up and down completely randomly.
Pair Corralation between Genpact and TELUS International
Taking into account the 90-day investment horizon Genpact Limited is expected to generate 0.39 times more return on investment than TELUS International. However, Genpact Limited is 2.54 times less risky than TELUS International. It trades about 0.14 of its potential returns per unit of risk. TELUS International is currently generating about -0.07 per unit of risk. If you would invest 3,202 in Genpact Limited on September 3, 2024 and sell it today you would earn a total of 1,414 from holding Genpact Limited or generate 44.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genpact Limited vs. TELUS International
Performance |
| Timeline |
| Genpact Limited |
| TELUS International |
Genpact and TELUS International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genpact and TELUS International
The main advantage of trading using opposite Genpact and TELUS International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genpact position performs unexpectedly, TELUS International 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 TELUS International will offset losses from the drop in TELUS International's long position.| Genpact vs. WNS Holdings | Genpact vs. ASGN Inc | Genpact vs. CACI International | Genpact vs. ExlService Holdings |
| TELUS International vs. Upstart Holdings | TELUS International vs. SoFi Technologies | TELUS International vs. Roblox Corp | TELUS International vs. Robinhood Markets |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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