Correlation Between Booz Allen and ExlService Holdings

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

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

Diversification Opportunities for Booz Allen and ExlService Holdings

-0.16

Correlation Coefficient

Booz Allen  ExlService Holdings

Good diversification

The 3 months correlation between Booz and ExlService is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Booz Allen Hamilton and ExlService Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ExlService Holdings and Booz Allen 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 Booz Allen Hamilton are associated (or correlated) with ExlService Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ExlService Holdings has no effect on the direction of Booz Allen i.e., Booz Allen and ExlService Holdings go up and down completely randomly.

Pair Corralation between Booz Allen and ExlService Holdings

Considering the 90-day investment horizon Booz Allen Hamilton is expected to under-perform the ExlService Holdings. In addition to that, Booz Allen is 1.6 times more volatile than ExlService Holdings. It trades about -0.08 of its total potential returns per unit of risk. ExlService Holdings is currently generating about -0.08 per unit of volatility. If you would invest  4,629  in ExlService Holdings on May 18, 2025 and sell it today you would lose (395.00) from holding ExlService Holdings or give up 8.53% of portfolio value over 90 days.

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

Booz Allen Hamilton  vs.  ExlService Holdings

Booz Allen Hamilton

Risk-Adjusted Performance

Weakest

Over the last 90 days Booz Allen Hamilton has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

ExlService Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days ExlService Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's essential indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Booz Allen and ExlService Holdings

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

The idea behind Booz Allen Hamilton and ExlService Holdings 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.