Correlation Between CLPS and ABG Acquisition

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

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

Diversification Opportunities for CLPS and ABG Acquisition

0.58

Correlation Coefficient

CLPS  ABG Acquisition

Very weak diversification

The 3 months correlation between CLPS and ABG is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding CLPS Inc and ABG Acquisition I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABG Acquisition I and CLPS 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 CLPS Inc are associated (or correlated) with ABG Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABG Acquisition I has no effect on the direction of CLPS i.e., CLPS and ABG Acquisition go up and down completely randomly.

Pair Corralation between CLPS and ABG Acquisition

If you would invest  1,020  in ABG Acquisition I on October 9, 2024 and sell it today you would earn a total of  0.00  from holding ABG Acquisition I or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	5.26%
Values	Daily Returns

CLPS Inc  vs.  ABG Acquisition I

CLPS Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CLPS Inc 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.

ABG Acquisition I

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ABG Acquisition I has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, ABG Acquisition is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with CLPS and ABG Acquisition

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

The idea behind CLPS Inc and ABG Acquisition I 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.