Correlation Between VNET Group and Conduent

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

By analyzing existing cross correlation between VNET Group DRC and Conduent, you can compare the effects of market volatilities on VNET Group and Conduent 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 VNET Group with a short position of Conduent. Check out your portfolio center. Please also check ongoing floating volatility patterns of VNET Group and Conduent.

Diversification Opportunities for VNET Group and Conduent

0.32

Correlation Coefficient

VNET Group  Conduent

Weak diversification

The 3 months correlation between VNET and Conduent is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding VNET Group DRC and Conduent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conduent and VNET Group 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 VNET Group DRC are associated (or correlated) with Conduent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conduent has no effect on the direction of VNET Group i.e., VNET Group and Conduent go up and down completely randomly.

Pair Corralation between VNET Group and Conduent

Given the investment horizon of 90 days VNET Group DRC is expected to generate 1.71 times more return on investment than Conduent. However, VNET Group is 1.71 times more volatile than Conduent. It trades about 0.1 of its potential returns per unit of risk. Conduent is currently generating about 0.08 per unit of risk. If you would invest  630.00  in VNET Group DRC on May 17, 2025 and sell it today you would earn a total of  165.00  from holding VNET Group DRC or generate 26.19% return on investment over 90 days.

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

VNET Group DRC  vs.  Conduent

VNET Group DRC

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in VNET Group DRC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, VNET Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Conduent

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Conduent are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak fundamental indicators, Conduent unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VNET Group and Conduent

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

The idea behind VNET Group DRC and Conduent 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.