Correlation Between DXC Technology and Power Integrations
Can any of the company-specific risk be diversified away by investing in both DXC Technology and Power Integrations 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 DXC Technology and Power Integrations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DXC Technology Co and Power Integrations, you can compare the effects of market volatilities on DXC Technology and Power Integrations 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 DXC Technology with a short position of Power Integrations. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and Power Integrations.
Diversification Opportunities for DXC Technology and Power Integrations
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DXC and Power is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and Power Integrations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Integrations and DXC Technology 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 DXC Technology Co are associated (or correlated) with Power Integrations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Integrations has no effect on the direction of DXC Technology i.e., DXC Technology and Power Integrations go up and down completely randomly.
Pair Corralation between DXC Technology and Power Integrations
Considering the 90-day investment horizon DXC Technology is expected to generate 4.16 times less return on investment than Power Integrations. But when comparing it to its historical volatility, DXC Technology Co is 1.1 times less risky than Power Integrations. It trades about 0.03 of its potential returns per unit of risk. Power Integrations is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 4,607 in Power Integrations on April 20, 2025 and sell it today you would earn a total of 818.00 from holding Power Integrations or generate 17.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DXC Technology Co vs. Power Integrations
Performance |
| Timeline |
| DXC Technology |
| Power Integrations |
DXC Technology and Power Integrations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DXC Technology and Power Integrations
The main advantage of trading using opposite DXC Technology and Power Integrations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DXC Technology position performs unexpectedly, Power Integrations 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 Power Integrations will offset losses from the drop in Power Integrations' long position.| DXC Technology vs. Gartner | DXC Technology vs. CDW Corp | DXC Technology vs. Cognizant Technology Solutions | DXC Technology vs. Fidelity National Information |
| Power Integrations vs. Diodes Incorporated | Power Integrations vs. MACOM Technology Solutions | Power Integrations vs. Cirrus Logic | Power Integrations vs. Amkor Technology |
Check out your portfolio center.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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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