Correlation Between Gartner and Conduent

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

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

Diversification Opportunities for Gartner and Conduent

-0.41

Correlation Coefficient

Gartner  Conduent

Very good diversification

The 3 months correlation between Gartner and Conduent is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Gartner and Conduent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conduent and Gartner 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 Gartner 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 Gartner i.e., Gartner and Conduent go up and down completely randomly.

Pair Corralation between Gartner and Conduent

Allowing for the 90-day total investment horizon Gartner is expected to under-perform the Conduent. But the stock apears to be less risky and, when comparing its historical volatility, Gartner is 1.8 times less risky than Conduent. The stock trades about -0.1 of its potential returns per unit of risk. The Conduent is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  339.00  in Conduent on March 3, 2024 and sell it today you would earn a total of  11.00  from holding Conduent or generate 3.24% return on investment over 90 days.

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

Gartner  vs.  Conduent

Gartner

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gartner has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Conduent

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Conduent are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental indicators, Conduent is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Gartner and Conduent

The main advantage of trading using opposite Gartner and Conduent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gartner 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 Gartner 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.