Correlation Between Leidos Holdings and DXC Technology
Can any of the company-specific risk be diversified away by investing in both Leidos Holdings and DXC Technology 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 Leidos Holdings and DXC Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leidos Holdings and DXC Technology Co, you can compare the effects of market volatilities on Leidos Holdings and DXC Technology 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 Leidos Holdings with a short position of DXC Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leidos Holdings and DXC Technology.
Diversification Opportunities for Leidos Holdings and DXC Technology
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Leidos and DXC is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Leidos Holdings and DXC Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DXC Technology and Leidos 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 Leidos Holdings are associated (or correlated) with DXC Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DXC Technology has no effect on the direction of Leidos Holdings i.e., Leidos Holdings and DXC Technology go up and down completely randomly.
Pair Corralation between Leidos Holdings and DXC Technology
Given the investment horizon of 90 days Leidos Holdings is expected to generate 0.91 times more return on investment than DXC Technology. However, Leidos Holdings is 1.1 times less risky than DXC Technology. It trades about 0.35 of its potential returns per unit of risk. DXC Technology Co is currently generating about 0.29 per unit of risk. If you would invest 15,920 in Leidos Holdings on June 2, 2025 and sell it today you would earn a total of 2,172 from holding Leidos Holdings or generate 13.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leidos Holdings vs. DXC Technology Co
Performance |
| Timeline |
| Leidos Holdings |
| DXC Technology |
Leidos Holdings and DXC Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leidos Holdings and DXC Technology
The main advantage of trading using opposite Leidos Holdings and DXC Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leidos Holdings position performs unexpectedly, DXC Technology 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 DXC Technology will offset losses from the drop in DXC Technology's long position.| Leidos Holdings vs. Science Applications International | Leidos Holdings vs. CACI International | Leidos Holdings vs. CDW Corp | Leidos Holdings vs. Gartner |
| DXC Technology vs. Gartner | DXC Technology vs. CDW Corp | DXC Technology vs. Cognizant Technology Solutions | DXC Technology vs. Fidelity National Information |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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