Correlation Between Precipio and ASGN

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

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

Diversification Opportunities for Precipio and ASGN

0.44

Correlation Coefficient

Precipio  ASGN

Very weak diversification

The 3 months correlation between Precipio and ASGN is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Precipio and ASGN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASGN Inc and Precipio 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 Precipio are associated (or correlated) with ASGN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASGN Inc has no effect on the direction of Precipio i.e., Precipio and ASGN go up and down completely randomly.

Pair Corralation between Precipio and ASGN

Given the investment horizon of 90 days Precipio is expected to under-perform the ASGN. In addition to that, Precipio is 1.24 times more volatile than ASGN Inc. It trades about -0.04 of its total potential returns per unit of risk. ASGN Inc is currently generating about -0.02 per unit of volatility. If you would invest  9,209  in ASGN Inc on September 18, 2024 and sell it today you would lose (353.00) from holding ASGN Inc or give up 3.83% of portfolio value over 90 days.

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

Precipio  vs.  ASGN Inc

Precipio

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Precipio has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Precipio is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

ASGN Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ASGN Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, ASGN is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Precipio and ASGN

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

The idea behind Precipio and ASGN 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..