Correlation Between Global Business and WNS Holdings
Can any of the company-specific risk be diversified away by investing in both Global Business and WNS 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 WNS 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 WNS Holdings, you can compare the effects of market volatilities on Global Business and WNS 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 WNS Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Business and WNS Holdings.
Diversification Opportunities for Global Business and WNS Holdings
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and WNS is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Global Business Travel and WNS Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WNS 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 WNS Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WNS Holdings has no effect on the direction of Global Business i.e., Global Business and WNS Holdings go up and down completely randomly.
Pair Corralation between Global Business and WNS Holdings
Given the investment horizon of 90 days Global Business Travel is expected to generate 1.2 times more return on investment than WNS Holdings. However, Global Business is 1.2 times more volatile than WNS Holdings. It trades about 0.26 of its potential returns per unit of risk. WNS Holdings is currently generating about 0.19 per unit of risk. If you would invest 788.00 in Global Business Travel on August 30, 2024 and sell it today you would earn a total of 141.00 from holding Global Business Travel or generate 17.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Business Travel vs. WNS Holdings
Performance |
| Timeline |
| Global Business Travel |
| WNS Holdings |
Global Business and WNS Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Business and WNS Holdings
The main advantage of trading using opposite Global Business and WNS Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Business position performs unexpectedly, WNS 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 WNS Holdings will offset losses from the drop in WNS Holdings' long position.| Global Business vs. Envestnet | Global Business vs. Meridianlink | Global Business vs. Alkami Technology | Global Business vs. Blackbaud |
| WNS Holdings vs. Genpact Limited | WNS Holdings vs. ASGN Inc | WNS Holdings vs. CACI International | WNS Holdings vs. ExlService 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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