Correlation Between Weyco and Infosys
Can any of the company-specific risk be diversified away by investing in both Weyco and Infosys 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 Weyco and Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weyco Group and Infosys Ltd ADR, you can compare the effects of market volatilities on Weyco and Infosys 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 Weyco with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyco and Infosys.
Diversification Opportunities for Weyco and Infosys
Very good diversification
The 3 months correlation between Weyco and Infosys is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Weyco Group and Infosys Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Ltd ADR and Weyco 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 Weyco Group are associated (or correlated) with Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Ltd ADR has no effect on the direction of Weyco i.e., Weyco and Infosys go up and down completely randomly.
Pair Corralation between Weyco and Infosys
Given the investment horizon of 90 days Weyco Group is expected to generate 1.46 times more return on investment than Infosys. However, Weyco is 1.46 times more volatile than Infosys Ltd ADR. It trades about 0.06 of its potential returns per unit of risk. Infosys Ltd ADR is currently generating about 0.04 per unit of risk. If you would invest 2,171 in Weyco Group on August 31, 2024 and sell it today you would earn a total of 1,392 from holding Weyco Group or generate 64.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Weyco Group vs. Infosys Ltd ADR
Performance |
| Timeline |
| Weyco Group |
| Infosys Ltd ADR |
Weyco and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weyco and Infosys
The main advantage of trading using opposite Weyco and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weyco position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.The idea behind Weyco Group and Infosys Ltd ADR 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.| Infosys vs. Cognizant Technology Solutions | Infosys vs. WNS Holdings | Infosys vs. CLARIVATE PLC | Infosys vs. Gartner |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |