Correlation Between SEATech Ventures and CLPS

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

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

Diversification Opportunities for SEATech Ventures and CLPS

-0.06

Correlation Coefficient

SEATech Ventures  CLPS

Good diversification

The 3 months correlation between SEATech and CLPS is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding SEATech Ventures Corp and CLPS Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CLPS Inc and SEATech Ventures 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 SEATech Ventures Corp are associated (or correlated) with CLPS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CLPS Inc has no effect on the direction of SEATech Ventures i.e., SEATech Ventures and CLPS go up and down completely randomly.

Pair Corralation between SEATech Ventures and CLPS

Given the investment horizon of 90 days SEATech Ventures Corp is expected to generate 19.65 times more return on investment than CLPS. However, SEATech Ventures is 19.65 times more volatile than CLPS Inc. It trades about 0.13 of its potential returns per unit of risk. CLPS Inc is currently generating about 0.04 per unit of risk. If you would invest  3.20  in SEATech Ventures Corp on November 28, 2024 and sell it today you would earn a total of  0.00  from holding SEATech Ventures Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.31%
Values	Daily Returns

SEATech Ventures Corp  vs.  CLPS Inc

SEATech Ventures Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SEATech Ventures Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, SEATech Ventures showed solid returns over the last few months and may actually be approaching a breakup point.

CLPS Inc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CLPS Inc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, CLPS may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with SEATech Ventures and CLPS

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

The idea behind SEATech Ventures Corp and CLPS 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .