Correlation Between CLPS and Fuse Science

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

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

Diversification Opportunities for CLPS and Fuse Science

-0.37

Correlation Coefficient

CLPS  Fuse Science

Very good diversification

The 3 months correlation between CLPS and Fuse is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding CLPS Inc and Fuse Science in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuse Science and CLPS 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 CLPS Inc are associated (or correlated) with Fuse Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuse Science has no effect on the direction of CLPS i.e., CLPS and Fuse Science go up and down completely randomly.

Pair Corralation between CLPS and Fuse Science

Given the investment horizon of 90 days CLPS is expected to generate 592.94 times less return on investment than Fuse Science. But when comparing it to its historical volatility, CLPS Inc is 7.05 times less risky than Fuse Science. It trades about 0.0 of its potential returns per unit of risk. Fuse Science is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  0.26  in Fuse Science on April 30, 2025 and sell it today you would earn a total of  0.37  from holding Fuse Science or generate 142.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

CLPS Inc  vs.  Fuse Science

CLPS Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days CLPS Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CLPS is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Fuse Science

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fuse Science are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Fuse Science reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CLPS and Fuse Science

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

The idea behind CLPS Inc and Fuse Science 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.