Correlation Between Teleperformance and Ijj

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

By analyzing existing cross correlation between Teleperformance PK and Ijj Corporation, you can compare the effects of market volatilities on Teleperformance and Ijj 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 Ijj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teleperformance and Ijj.

Diversification Opportunities for Teleperformance and Ijj

0.0

Correlation Coefficient

Teleperformance  Ijj

Pay attention - limited upside

The 3 months correlation between Teleperformance and Ijj is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Teleperformance PK and Ijj Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ijj Corporation 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 PK are associated (or correlated) with Ijj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ijj Corporation has no effect on the direction of Teleperformance i.e., Teleperformance and Ijj go up and down completely randomly.

Pair Corralation between Teleperformance and Ijj

Assuming the 90 days horizon Teleperformance is expected to generate 5.47 times less return on investment than Ijj. But when comparing it to its historical volatility, Teleperformance PK is 10.11 times less risky than Ijj. It trades about 0.13 of its potential returns per unit of risk. Ijj Corporation is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  0.05  in Ijj Corporation on November 29, 2024 and sell it today you would lose (0.01) from holding Ijj Corporation or give up 20.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Teleperformance PK  vs.  Ijj Corp.

Teleperformance PK

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Teleperformance PK are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile technical and fundamental indicators, Teleperformance showed solid returns over the last few months and may actually be approaching a breakup point.

Ijj Corporation

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ijj Corporation are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain forward-looking indicators, Ijj reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Teleperformance and Ijj

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

The idea behind Teleperformance PK and Ijj Corporation 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.

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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.