Correlation Between Amdocs and Postal Savings

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

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

Diversification Opportunities for Amdocs and Postal Savings

-0.71

Correlation Coefficient

Amdocs  Postal Savings

Pay attention - limited upside

The 3 months correlation between Amdocs and Postal is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Amdocs Limited and Postal Savings Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Savings Bank and Amdocs 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 Amdocs Limited are associated (or correlated) with Postal Savings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Savings Bank has no effect on the direction of Amdocs i.e., Amdocs and Postal Savings go up and down completely randomly.

Pair Corralation between Amdocs and Postal Savings

Assuming the 90 days horizon Amdocs Limited is expected to under-perform the Postal Savings. But the stock apears to be less risky and, when comparing its historical volatility, Amdocs Limited is 1.27 times less risky than Postal Savings. The stock trades about -0.09 of its potential returns per unit of risk. The Postal Savings Bank is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  56.00  in Postal Savings Bank on May 16, 2025 and sell it today you would earn a total of  5.00  from holding Postal Savings Bank or generate 8.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Amdocs Limited  vs.  Postal Savings Bank

Amdocs Limited

Risk-Adjusted Performance

Weakest

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

Postal Savings Bank

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Postal Savings Bank are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Postal Savings may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Amdocs and Postal Savings

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

The idea behind Amdocs Limited and Postal Savings Bank 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.