Correlation Between Global Business and ExlService Holdings
Can any of the company-specific risk be diversified away by investing in both Global Business and ExlService Holdings 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 Global Business and ExlService Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Business Travel and ExlService Holdings, you can compare the effects of market volatilities on Global Business and ExlService Holdings 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 Global Business with a short position of ExlService Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Business and ExlService Holdings.
Diversification Opportunities for Global Business and ExlService Holdings
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Global and ExlService is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Global Business Travel and ExlService Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ExlService Holdings and Global Business 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 Global Business Travel are associated (or correlated) with ExlService Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ExlService Holdings has no effect on the direction of Global Business i.e., Global Business and ExlService Holdings go up and down completely randomly.
Pair Corralation between Global Business and ExlService Holdings
Given the investment horizon of 90 days Global Business Travel is expected to generate 1.9 times more return on investment than ExlService Holdings. However, Global Business is 1.9 times more volatile than ExlService Holdings. It trades about 0.29 of its potential returns per unit of risk. ExlService Holdings is currently generating about 0.33 per unit of risk. If you would invest 776.00 in Global Business Travel on August 31, 2024 and sell it today you would earn a total of 153.00 from holding Global Business Travel or generate 19.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Business Travel vs. ExlService Holdings
Performance |
| Timeline |
| Global Business Travel |
| ExlService Holdings |
Global Business and ExlService Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Business and ExlService Holdings
The main advantage of trading using opposite Global Business and ExlService Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Business position performs unexpectedly, ExlService Holdings 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 ExlService Holdings will offset losses from the drop in ExlService Holdings' long position.| Global Business vs. Envestnet | Global Business vs. Meridianlink | Global Business vs. Alkami Technology | Global Business vs. Blackbaud |
| ExlService Holdings vs. Genpact Limited | ExlService Holdings vs. ASGN Inc | ExlService Holdings vs. TTEC Holdings | ExlService Holdings vs. WNS Holdings |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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