Correlation Between ExlService Holdings and Professional Diversity

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

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

Diversification Opportunities for ExlService Holdings and Professional Diversity

-0.57

Correlation Coefficient

ExlService Holdings  Professional Diversity

Excellent diversification

The 3 months correlation between ExlService and Professional is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding ExlService Holdings and Professional Diversity Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Professional Diversity and ExlService 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 ExlService Holdings are associated (or correlated) with Professional Diversity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Professional Diversity has no effect on the direction of ExlService Holdings i.e., ExlService Holdings and Professional Diversity go up and down completely randomly.

Pair Corralation between ExlService Holdings and Professional Diversity

Given the investment horizon of 90 days ExlService Holdings is expected to under-perform the Professional Diversity. But the stock apears to be less risky and, when comparing its historical volatility, ExlService Holdings is 8.1 times less risky than Professional Diversity. The stock trades about -0.07 of its potential returns per unit of risk. The Professional Diversity Network is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  152.00  in Professional Diversity Network on May 17, 2025 and sell it today you would earn a total of  70.00  from holding Professional Diversity Network or generate 46.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

ExlService Holdings  vs.  Professional Diversity Network

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.

Professional Diversity

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Professional Diversity Network are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Professional Diversity displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ExlService Holdings and Professional Diversity

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

The idea behind ExlService Holdings and Professional Diversity Network 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.