Correlation Between ExlService Holdings and SPX Corp

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

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

Diversification Opportunities for ExlService Holdings and SPX Corp

-0.78

Correlation Coefficient

ExlService Holdings  SPX Corp

Pay attention - limited upside

The 3 months correlation between ExlService and SPX is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding ExlService Holdings and SPX Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPX Corp 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 SPX Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPX Corp has no effect on the direction of ExlService Holdings i.e., ExlService Holdings and SPX Corp go up and down completely randomly.

Pair Corralation between ExlService Holdings and SPX Corp

Given the investment horizon of 90 days ExlService Holdings is expected to under-perform the SPX Corp. In addition to that, ExlService Holdings is 1.01 times more volatile than SPX Corp. It trades about -0.07 of its total potential returns per unit of risk. SPX Corp is currently generating about 0.26 per unit of volatility. If you would invest  15,397  in SPX Corp on May 14, 2025 and sell it today you would earn a total of  4,654  from holding SPX Corp or generate 30.23% return on investment over 90 days.

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

ExlService Holdings  vs.  SPX Corp

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.

SPX Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SPX Corp are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, SPX Corp exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ExlService Holdings and SPX Corp

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

The idea behind ExlService Holdings and SPX Corp 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.