Correlation Between WNS Holdings and CGI
Can any of the company-specific risk be diversified away by investing in both WNS Holdings and CGI 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 WNS Holdings and CGI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WNS Holdings and CGI Inc, you can compare the effects of market volatilities on WNS Holdings and CGI 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 WNS Holdings with a short position of CGI. Check out your portfolio center. Please also check ongoing floating volatility patterns of WNS Holdings and CGI.
Diversification Opportunities for WNS Holdings and CGI
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WNS and CGI is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding WNS Holdings and CGI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CGI Inc and WNS Holdings 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 WNS Holdings are associated (or correlated) with CGI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CGI Inc has no effect on the direction of WNS Holdings i.e., WNS Holdings and CGI go up and down completely randomly.
Pair Corralation between WNS Holdings and CGI
Considering the 90-day investment horizon WNS Holdings is expected to generate 1.93 times more return on investment than CGI. However, WNS Holdings is 1.93 times more volatile than CGI Inc. It trades about 0.16 of its potential returns per unit of risk. CGI Inc is currently generating about -0.05 per unit of risk. If you would invest 4,782 in WNS Holdings on August 24, 2024 and sell it today you would earn a total of 408.00 from holding WNS Holdings or generate 8.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WNS Holdings vs. CGI Inc
Performance |
| Timeline |
| WNS Holdings |
| CGI Inc |
WNS Holdings and CGI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WNS Holdings and CGI
The main advantage of trading using opposite WNS Holdings and CGI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WNS Holdings position performs unexpectedly, CGI 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 CGI will offset losses from the drop in CGI's long position.| WNS Holdings vs. Fidelity National Information | WNS Holdings vs. International Business Machines | WNS Holdings vs. Kyndryl Holdings | WNS Holdings 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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