Correlation Between ExlService Holdings and Perma Fix

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

By analyzing existing cross correlation between ExlService Holdings and Perma Fix Environmental Svcs, you can compare the effects of market volatilities on ExlService Holdings and Perma Fix 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 Perma Fix. Check out your portfolio center. Please also check ongoing floating volatility patterns of ExlService Holdings and Perma Fix.

Diversification Opportunities for ExlService Holdings and Perma Fix

-0.44

Correlation Coefficient

ExlService Holdings  Perma Fix

Very good diversification

The 3 months correlation between ExlService and Perma is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding ExlService Holdings and Perma Fix Environmental Svcs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perma Fix Environmental 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 Perma Fix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perma Fix Environmental has no effect on the direction of ExlService Holdings i.e., ExlService Holdings and Perma Fix go up and down completely randomly.

Pair Corralation between ExlService Holdings and Perma Fix

Given the investment horizon of 90 days ExlService Holdings is expected to under-perform the Perma Fix. But the stock apears to be less risky and, when comparing its historical volatility, ExlService Holdings is 1.25 times less risky than Perma Fix. The stock trades about -0.04 of its potential returns per unit of risk. The Perma Fix Environmental Svcs is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest  823.00  in Perma Fix Environmental Svcs on April 29, 2025 and sell it today you would earn a total of  410.00  from holding Perma Fix Environmental Svcs or generate 49.82% return on investment over 90 days.

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

ExlService Holdings  vs.  Perma Fix Environmental Svcs

ExlService Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days ExlService Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, ExlService Holdings is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Perma Fix Environmental

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Perma Fix Environmental Svcs are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, Perma Fix demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ExlService Holdings and Perma Fix

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

The idea behind ExlService Holdings and Perma Fix Environmental Svcs 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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.