Correlation Between CGI and ExlService Holdings
Can any of the company-specific risk be diversified away by investing in both CGI 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 CGI and ExlService Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CGI Inc and ExlService Holdings, you can compare the effects of market volatilities on CGI 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 CGI with a short position of ExlService Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of CGI and ExlService Holdings.
Diversification Opportunities for CGI and ExlService Holdings
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CGI and ExlService is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding CGI Inc and ExlService Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ExlService Holdings and CGI 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 CGI Inc 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 CGI i.e., CGI and ExlService Holdings go up and down completely randomly.
Pair Corralation between CGI and ExlService Holdings
Considering the 90-day investment horizon CGI Inc is expected to under-perform the ExlService Holdings. But the stock apears to be less risky and, when comparing its historical volatility, CGI Inc is 1.51 times less risky than ExlService Holdings. The stock trades about -0.03 of its potential returns per unit of risk. The ExlService Holdings is currently generating about 0.45 of returns per unit of risk over similar time horizon. If you would invest 3,874 in ExlService Holdings on August 27, 2024 and sell it today you would earn a total of 803.00 from holding ExlService Holdings or generate 20.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CGI Inc vs. ExlService Holdings
Performance |
| Timeline |
| CGI Inc |
| ExlService Holdings |
CGI and ExlService Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CGI and ExlService Holdings
The main advantage of trading using opposite CGI and ExlService Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CGI 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.The idea behind CGI Inc and ExlService Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| ExlService Holdings vs. Oneconnect Financial Technology | ExlService Holdings vs. Global Business Travel | ExlService Holdings vs. Alight Inc | ExlService Holdings vs. CS Disco LLC |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |