Correlation Between Innodata and Conduent
Can any of the company-specific risk be diversified away by investing in both Innodata and Conduent 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 Innodata and Conduent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innodata and Conduent, you can compare the effects of market volatilities on Innodata and Conduent 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 Innodata with a short position of Conduent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innodata and Conduent.
Diversification Opportunities for Innodata and Conduent
Modest diversification
The 3 months correlation between Innodata and Conduent is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Innodata and Conduent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conduent and Innodata 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 Innodata are associated (or correlated) with Conduent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conduent has no effect on the direction of Innodata i.e., Innodata and Conduent go up and down completely randomly.
Pair Corralation between Innodata and Conduent
Given the investment horizon of 90 days Innodata is expected to under-perform the Conduent. In addition to that, Innodata is 1.91 times more volatile than Conduent. It trades about -0.05 of its total potential returns per unit of risk. Conduent is currently generating about 0.25 per unit of volatility. If you would invest 369.00 in Conduent on September 19, 2024 and sell it today you would earn a total of 63.00 from holding Conduent or generate 17.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innodata vs. Conduent
Performance |
| Timeline |
| Innodata |
| Conduent |
Innodata and Conduent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innodata and Conduent
The main advantage of trading using opposite Innodata and Conduent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innodata position performs unexpectedly, Conduent 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 Conduent will offset losses from the drop in Conduent's long position.| Innodata vs. Oneconnect Financial Technology | Innodata vs. Global Business Travel | Innodata vs. Alight Inc | Innodata vs. CS Disco LLC |
| Conduent vs. Oneconnect Financial Technology | Conduent vs. Global Business Travel | Conduent vs. Alight Inc | Conduent 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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