Correlation Between Abacus Life, and Stepstone

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

By analyzing existing cross correlation between Abacus Life, 9875 and Stepstone Group, you can compare the effects of market volatilities on Abacus Life, and Stepstone 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 Abacus Life, with a short position of Stepstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abacus Life, and Stepstone.

Diversification Opportunities for Abacus Life, and Stepstone

-0.21

Correlation Coefficient

Abacus Life,  Stepstone

Very good diversification

The 3 months correlation between Abacus and Stepstone is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Abacus Life, 9875 and Stepstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stepstone Group and Abacus Life, 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 Abacus Life, 9875 are associated (or correlated) with Stepstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stepstone Group has no effect on the direction of Abacus Life, i.e., Abacus Life, and Stepstone go up and down completely randomly.

Pair Corralation between Abacus Life, and Stepstone

Assuming the 90 days horizon Abacus Life, 9875 is expected to generate 28.26 times more return on investment than Stepstone. However, Abacus Life, is 28.26 times more volatile than Stepstone Group. It trades about 0.06 of its potential returns per unit of risk. Stepstone Group is currently generating about 0.12 per unit of risk. If you would invest  0.00  in Abacus Life, 9875 on October 3, 2024 and sell it today you would earn a total of  3,366  from holding Abacus Life, 9875 or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	74.6%
Values	Daily Returns

Abacus Life, 9875  vs.  Stepstone Group

Abacus Life, 9875

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Abacus Life, 9875 are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite weak essential indicators, Abacus Life, disclosed solid returns over the last few months and may actually be approaching a breakup point.

Stepstone Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Stepstone Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Stepstone is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Abacus Life, and Stepstone

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

The idea behind Abacus Life, 9875 and Stepstone Group 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 CEOs Directory module to screen CEOs from public companies around the world.