Correlation Between CLPS and Wah Fu

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

By analyzing existing cross correlation between CLPS Inc and Wah Fu Education, you can compare the effects of market volatilities on CLPS and Wah Fu 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 Wah Fu. Check out your portfolio center. Please also check ongoing floating volatility patterns of CLPS and Wah Fu.

Diversification Opportunities for CLPS and Wah Fu

0.16

Correlation Coefficient

CLPS  Wah Fu

Average diversification

The 3 months correlation between CLPS and Wah is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding CLPS Inc and Wah Fu Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wah Fu Education 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 Wah Fu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wah Fu Education has no effect on the direction of CLPS i.e., CLPS and Wah Fu go up and down completely randomly.

Pair Corralation between CLPS and Wah Fu

Given the investment horizon of 90 days CLPS Inc is expected to under-perform the Wah Fu. In addition to that, CLPS is 1.03 times more volatile than Wah Fu Education. It trades about -0.01 of its total potential returns per unit of risk. Wah Fu Education is currently generating about 0.03 per unit of volatility. If you would invest  140.00  in Wah Fu Education on May 1, 2025 and sell it today you would earn a total of  3.00  from holding Wah Fu Education or generate 2.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

CLPS Inc  vs.  Wah Fu Education

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.

Wah Fu Education

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Wah Fu Education are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Wah Fu is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with CLPS and Wah Fu

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

The idea behind CLPS Inc and Wah Fu Education 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.