Correlation Between Jack Henry and Genpact
Can any of the company-specific risk be diversified away by investing in both Jack Henry and Genpact 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 Jack Henry and Genpact into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jack Henry Associates and Genpact Limited, you can compare the effects of market volatilities on Jack Henry and Genpact 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 Jack Henry with a short position of Genpact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack Henry and Genpact.
Diversification Opportunities for Jack Henry and Genpact
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jack and Genpact is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Jack Henry Associates and Genpact Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genpact Limited and Jack Henry 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 Jack Henry Associates are associated (or correlated) with Genpact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genpact Limited has no effect on the direction of Jack Henry i.e., Jack Henry and Genpact go up and down completely randomly.
Pair Corralation between Jack Henry and Genpact
Given the investment horizon of 90 days Jack Henry Associates is expected to under-perform the Genpact. But the stock apears to be less risky and, when comparing its historical volatility, Jack Henry Associates is 1.15 times less risky than Genpact. The stock trades about 0.0 of its potential returns per unit of risk. The Genpact Limited is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4,380 in Genpact Limited on August 24, 2024 and sell it today you would earn a total of 239.00 from holding Genpact Limited or generate 5.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jack Henry Associates vs. Genpact Limited
Performance |
| Timeline |
| Jack Henry Associates |
| Genpact Limited |
Jack Henry and Genpact Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jack Henry and Genpact
The main advantage of trading using opposite Jack Henry and Genpact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jack Henry position performs unexpectedly, Genpact 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 Genpact will offset losses from the drop in Genpact's long position.| Jack Henry vs. CACI International | Jack Henry vs. CDW Corp | Jack Henry vs. Broadridge Financial Solutions | Jack Henry vs. ExlService Holdings |
| Genpact vs. Fidelity National Information | Genpact vs. International Business Machines | Genpact vs. Kyndryl Holdings | Genpact vs. DXC Technology Co |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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