Correlation Between Wex and ExlService Holdings
Can any of the company-specific risk be diversified away by investing in both Wex and ExlService Holdings 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 Wex and ExlService Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wex Inc and ExlService Holdings, you can compare the effects of market volatilities on Wex and ExlService Holdings 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 Wex with a short position of ExlService Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wex and ExlService Holdings.
Diversification Opportunities for Wex and ExlService Holdings
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Wex and ExlService is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Wex Inc and ExlService Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ExlService Holdings and Wex 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 Wex Inc are associated (or correlated) with ExlService Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ExlService Holdings has no effect on the direction of Wex i.e., Wex and ExlService Holdings go up and down completely randomly.
Pair Corralation between Wex and ExlService Holdings
Considering the 90-day investment horizon Wex Inc is expected to under-perform the ExlService Holdings. In addition to that, Wex is 1.18 times more volatile than ExlService Holdings. It trades about -0.1 of its total potential returns per unit of risk. ExlService Holdings is currently generating about -0.1 per unit of volatility. If you would invest 4,359 in ExlService Holdings on August 28, 2025 and sell it today you would lose (475.00) from holding ExlService Holdings or give up 10.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wex Inc vs. ExlService Holdings
Performance |
| Timeline |
| Wex Inc |
| ExlService Holdings |
Wex and ExlService Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wex and ExlService Holdings
The main advantage of trading using opposite Wex and ExlService Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wex position performs unexpectedly, ExlService Holdings 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 ExlService Holdings will offset losses from the drop in ExlService Holdings' long position.| Wex vs. Union Medical Healthcare | Wex vs. Blue Note Mining | Wex vs. Harmony Gold Mining | Wex vs. PureTech Health plc |
| ExlService Holdings vs. Take Two Interactive Software | ExlService Holdings vs. Arizona Metals Corp | ExlService Holdings vs. Enduro Metals | ExlService Holdings vs. Fortescue Metals Group |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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