Correlation Between WNS Holdings and Infosys
Can any of the company-specific risk be diversified away by investing in both WNS Holdings 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 WNS Holdings and Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WNS Holdings and Infosys Ltd ADR, you can compare the effects of market volatilities on WNS Holdings 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 WNS Holdings with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of WNS Holdings and Infosys.
Diversification Opportunities for WNS Holdings and Infosys
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WNS and Infosys is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding WNS Holdings 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 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 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 WNS Holdings i.e., WNS Holdings and Infosys go up and down completely randomly.
Pair Corralation between WNS Holdings and Infosys
Considering the 90-day investment horizon WNS Holdings is expected to generate 3.42 times more return on investment than Infosys. However, WNS Holdings is 3.42 times more volatile than Infosys Ltd ADR. It trades about 0.27 of its potential returns per unit of risk. Infosys Ltd ADR is currently generating about -0.09 per unit of risk. If you would invest 4,699 in WNS Holdings on November 4, 2024 and sell it today you would earn a total of 1,426 from holding WNS Holdings or generate 30.35% 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. Infosys Ltd ADR
Performance |
| Timeline |
| WNS Holdings |
| Infosys Ltd ADR |
WNS Holdings and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WNS Holdings and Infosys
The main advantage of trading using opposite WNS Holdings and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WNS Holdings 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.| WNS Holdings vs. Genpact Limited | WNS Holdings vs. ASGN Inc | WNS Holdings vs. CACI International | WNS Holdings vs. ExlService Holdings |
| 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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