Correlation Between DXC Technology and International Business
Can any of the company-specific risk be diversified away by investing in both DXC Technology and International Business 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 DXC Technology and International Business into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DXC Technology Co and International Business Machines, you can compare the effects of market volatilities on DXC Technology and International Business 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 DXC Technology with a short position of International Business. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and International Business.
Diversification Opportunities for DXC Technology and International Business
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DXC and International is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and International Business Machine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Business and DXC Technology 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 DXC Technology Co are associated (or correlated) with International Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Business has no effect on the direction of DXC Technology i.e., DXC Technology and International Business go up and down completely randomly.
Pair Corralation between DXC Technology and International Business
Considering the 90-day investment horizon DXC Technology Co is expected to generate 1.2 times more return on investment than International Business. However, DXC Technology is 1.2 times more volatile than International Business Machines. It trades about -0.05 of its potential returns per unit of risk. International Business Machines is currently generating about -0.28 per unit of risk. If you would invest 2,106 in DXC Technology Co on January 27, 2024 and sell it today you would lose (69.00) from holding DXC Technology Co or give up 3.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
DXC Technology Co vs. International Business Machine
Performance |
| Timeline |
| DXC Technology |
| International Business |
DXC Technology and International Business Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DXC Technology and International Business
The main advantage of trading using opposite DXC Technology and International Business positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DXC Technology position performs unexpectedly, International Business 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 International Business will offset losses from the drop in International Business' long position.| DXC Technology vs. FiscalNote Holdings | DXC Technology vs. Innodata | DXC Technology vs. Aurora Innovation | DXC Technology vs. Conduent |
| International Business vs. FiscalNote Holdings | International Business vs. Innodata | International Business vs. Aurora Innovation | International Business vs. Conduent |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |