Correlation Between Abacus Life and ChampionX
Can any of the company-specific risk be diversified away by investing in both Abacus Life and ChampionX 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 Abacus Life and ChampionX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abacus Life and ChampionX, you can compare the effects of market volatilities on Abacus Life and ChampionX 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 Abacus Life with a short position of ChampionX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abacus Life and ChampionX.
Diversification Opportunities for Abacus Life and ChampionX
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Abacus and ChampionX is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Abacus Life and ChampionX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChampionX and Abacus Life 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 Abacus Life are associated (or correlated) with ChampionX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChampionX has no effect on the direction of Abacus Life i.e., Abacus Life and ChampionX go up and down completely randomly.
Pair Corralation between Abacus Life and ChampionX
Considering the 90-day investment horizon Abacus Life is expected to generate 1.88 times more return on investment than ChampionX. However, Abacus Life is 1.88 times more volatile than ChampionX. It trades about 0.0 of its potential returns per unit of risk. ChampionX is currently generating about 0.0 per unit of risk. If you would invest 1,029 in Abacus Life on November 2, 2024 and sell it today you would lose (250.00) from holding Abacus Life or give up 24.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Abacus Life vs. ChampionX
Performance |
| Timeline |
| Abacus Life |
| ChampionX |
Abacus Life and ChampionX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abacus Life and ChampionX
The main advantage of trading using opposite Abacus Life and ChampionX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abacus Life position performs unexpectedly, ChampionX 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 ChampionX will offset losses from the drop in ChampionX's long position.| Abacus Life vs. Nicola Mining | Abacus Life vs. X FAB Silicon Foundries | Abacus Life vs. NL Industries | Abacus Life vs. Chester Mining |
| ChampionX vs. Expro Group Holdings | ChampionX vs. Ranger Energy Services | ChampionX vs. Cactus Inc | ChampionX vs. MRC Global |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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