Correlation Between WNS Holdings and Wise Plc
Can any of the company-specific risk be diversified away by investing in both WNS Holdings and Wise Plc 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 Wise Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WNS Holdings and Wise plc, you can compare the effects of market volatilities on WNS Holdings and Wise Plc 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 Wise Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of WNS Holdings and Wise Plc.
Diversification Opportunities for WNS Holdings and Wise Plc
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between WNS and Wise is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding WNS Holdings and Wise plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wise plc 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 Wise Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wise plc has no effect on the direction of WNS Holdings i.e., WNS Holdings and Wise Plc go up and down completely randomly.
Pair Corralation between WNS Holdings and Wise Plc
Considering the 90-day investment horizon WNS Holdings is expected to under-perform the Wise Plc. In addition to that, WNS Holdings is 1.01 times more volatile than Wise plc. It trades about -0.3 of its total potential returns per unit of risk. Wise plc is currently generating about 0.45 per unit of volatility. If you would invest 1,110 in Wise plc on September 23, 2024 and sell it today you would earn a total of 211.00 from holding Wise plc or generate 19.01% 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. Wise plc
Performance |
Timeline |
WNS Holdings |
Wise plc |
WNS Holdings and Wise Plc Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WNS Holdings and Wise Plc
The main advantage of trading using opposite WNS Holdings and Wise Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WNS Holdings position performs unexpectedly, Wise Plc 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 Wise Plc will offset losses from the drop in Wise Plc's long position.WNS Holdings vs. Oneconnect Financial Technology | WNS Holdings vs. Global Business Travel | WNS Holdings vs. Alight Inc | WNS Holdings vs. CS Disco LLC |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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