Correlation Between Teleperformance and Maximus

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

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

Diversification Opportunities for Teleperformance and Maximus

0.74

Correlation Coefficient

Teleperformance  Maximus

Poor diversification

The 3 months correlation between Teleperformance and Maximus is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Teleperformance SE and Maximus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maximus and Teleperformance 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 Teleperformance SE are associated (or correlated) with Maximus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maximus has no effect on the direction of Teleperformance i.e., Teleperformance and Maximus go up and down completely randomly.

Pair Corralation between Teleperformance and Maximus

Assuming the 90 days horizon Teleperformance SE is expected to generate 1.57 times more return on investment than Maximus. However, Teleperformance is 1.57 times more volatile than Maximus. It trades about -0.07 of its potential returns per unit of risk. Maximus is currently generating about -0.17 per unit of risk. If you would invest  10,556  in Teleperformance SE on September 12, 2024 and sell it today you would lose (1,353) from holding Teleperformance SE or give up 12.82% of portfolio value over 90 days.

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

Teleperformance SE  vs.  Maximus

Teleperformance SE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Teleperformance SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Maximus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maximus has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's primary indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Teleperformance and Maximus

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

The idea behind Teleperformance SE and Maximus 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.