Correlation Between Veralto and Genpact
Can any of the company-specific risk be diversified away by investing in both Veralto 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 Veralto and Genpact into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veralto and Genpact Limited, you can compare the effects of market volatilities on Veralto 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 Veralto with a short position of Genpact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veralto and Genpact.
Diversification Opportunities for Veralto and Genpact
Very good diversification
The 3 months correlation between Veralto and Genpact is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Veralto and Genpact Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genpact Limited and Veralto 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 Veralto 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 Veralto i.e., Veralto and Genpact go up and down completely randomly.
Pair Corralation between Veralto and Genpact
Given the investment horizon of 90 days Veralto is expected to generate 5.22 times less return on investment than Genpact. But when comparing it to its historical volatility, Veralto is 2.54 times less risky than Genpact. It trades about 0.18 of its potential returns per unit of risk. Genpact Limited is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 3,830 in Genpact Limited on August 29, 2024 and sell it today you would earn a total of 819.00 from holding Genpact Limited or generate 21.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Veralto vs. Genpact Limited
Performance |
| Timeline |
| Veralto |
| Genpact Limited |
Veralto and Genpact Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Veralto and Genpact
The main advantage of trading using opposite Veralto and Genpact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veralto 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.| Veralto vs. Victorias Secret Co | Veralto vs. Lululemon Athletica | Veralto vs. Tandy Leather Factory | Veralto vs. Nextplat Corp |
| Genpact vs. WNS Holdings | Genpact vs. ASGN Inc | Genpact vs. CACI International | Genpact 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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