Correlation Between Abpro Holdings and BRP

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

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

Diversification Opportunities for Abpro Holdings and BRP

0.2

Correlation Coefficient

Abpro Holdings  BRP

Modest diversification

The 3 months correlation between Abpro and BRP is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Abpro Holdings and BRP Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRP Inc and Abpro 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 Abpro Holdings are associated (or correlated) with BRP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRP Inc has no effect on the direction of Abpro Holdings i.e., Abpro Holdings and BRP go up and down completely randomly.

Pair Corralation between Abpro Holdings and BRP

Assuming the 90 days horizon Abpro Holdings is expected to generate 14.39 times more return on investment than BRP. However, Abpro Holdings is 14.39 times more volatile than BRP Inc. It trades about 0.13 of its potential returns per unit of risk. BRP Inc is currently generating about -0.03 per unit of risk. If you would invest  3.30  in Abpro Holdings on October 22, 2024 and sell it today you would earn a total of  2.95  from holding Abpro Holdings or generate 89.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	48.89%
Values	Daily Returns

Abpro Holdings  vs.  BRP Inc

Abpro Holdings

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Abpro Holdings are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Abpro Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

BRP Inc

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BRP Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, BRP is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Abpro Holdings and BRP

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

The idea behind Abpro Holdings and BRP Inc 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.