Correlation Between Concentrix and WNS Holdings

Can any of the company-specific risk be diversified away by investing in both Concentrix and WNS Holdings 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 Concentrix and WNS Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Concentrix and WNS Holdings, you can compare the effects of market volatilities on Concentrix and WNS Holdings 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 Concentrix with a short position of WNS Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concentrix and WNS Holdings.

Diversification Opportunities for Concentrix and WNS Holdings

0.49

Correlation Coefficient

Concentrix  WNS Holdings

Very weak diversification

The 3 months correlation between Concentrix and WNS is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Concentrix and WNS Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WNS Holdings and Concentrix 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 Concentrix are associated (or correlated) with WNS Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WNS Holdings has no effect on the direction of Concentrix i.e., Concentrix and WNS Holdings go up and down completely randomly.

Pair Corralation between Concentrix and WNS Holdings

Given the investment horizon of 90 days Concentrix is expected to generate 2.17 times more return on investment than WNS Holdings. However, Concentrix is 2.17 times more volatile than WNS Holdings. It trades about 0.24 of its potential returns per unit of risk. WNS Holdings is currently generating about -0.06 per unit of risk. If you would invest  3,777  in Concentrix on September 17, 2024 and sell it today you would earn a total of  636.00  from holding Concentrix or generate 16.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Concentrix  vs.  WNS Holdings

Concentrix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Concentrix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

WNS Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WNS Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Concentrix and WNS Holdings

The main advantage of trading using opposite Concentrix and WNS Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concentrix position performs unexpectedly, WNS Holdings 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 WNS Holdings will offset losses from the drop in WNS Holdings' long position.

The idea behind Concentrix and WNS Holdings 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.

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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.