Correlation Between N Able and CLPS
Can any of the company-specific risk be diversified away by investing in both N Able 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 N Able and CLPS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between N Able Inc and CLPS Inc, you can compare the effects of market volatilities on N Able 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 N Able with a short position of CLPS. Check out your portfolio center. Please also check ongoing floating volatility patterns of N Able and CLPS.
Diversification Opportunities for N Able and CLPS
Very weak diversification
The 3 months correlation between NABL and CLPS is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding N Able Inc and CLPS Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CLPS Inc and N Able 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 N Able Inc 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 N Able i.e., N Able and CLPS go up and down completely randomly.
Pair Corralation between N Able and CLPS
Given the investment horizon of 90 days N Able Inc is expected to under-perform the CLPS. But the stock apears to be less risky and, when comparing its historical volatility, N Able Inc is 2.86 times less risky than CLPS. The stock trades about -0.41 of its potential returns per unit of risk. The CLPS Inc is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 134.00 in CLPS Inc on August 31, 2024 and sell it today you would lose (23.00) from holding CLPS Inc or give up 17.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
N Able Inc vs. CLPS Inc
Performance |
| Timeline |
| N Able Inc |
| CLPS Inc |
N Able and CLPS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with N Able and CLPS
The main advantage of trading using opposite N Able and CLPS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if N Able 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.| N Able vs. Innodata | N Able vs. International Business Machines | N Able vs. Aurora Innovation | N Able vs. BigBearai Holdings |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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