Correlation Between Upstream Bio, and Abpro Holdings

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

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

Diversification Opportunities for Upstream Bio, and Abpro Holdings

-0.54

Correlation Coefficient

Upstream Bio,  Abpro Holdings

Excellent diversification

The 3 months correlation between Upstream and Abpro is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Upstream Bio, and Abpro Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abpro Holdings and Upstream Bio, 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 Upstream Bio, are associated (or correlated) with Abpro Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abpro Holdings has no effect on the direction of Upstream Bio, i.e., Upstream Bio, and Abpro Holdings go up and down completely randomly.

Pair Corralation between Upstream Bio, and Abpro Holdings

Considering the 90-day investment horizon Upstream Bio, is expected to under-perform the Abpro Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Upstream Bio, is 5.86 times less risky than Abpro Holdings. The stock trades about -0.14 of its potential returns per unit of risk. The Abpro Holdings is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  4.40  in Abpro Holdings on October 4, 2024 and sell it today you would earn a total of  1.85  from holding Abpro Holdings or generate 42.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	80.95%
Values	Daily Returns

Upstream Bio,  vs.  Abpro Holdings

Upstream Bio,

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Upstream Bio, are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Upstream Bio, sustained solid returns over the last few months and may actually be approaching a breakup point.

Abpro Holdings

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Abpro Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Abpro Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Upstream Bio, and Abpro Holdings

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

The idea behind Upstream Bio, and Abpro Holdings 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.

Check out your portfolio center.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.