Correlation Between Climb Bio and ABVC Biopharma

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

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

Diversification Opportunities for Climb Bio and ABVC Biopharma

0.43

Correlation Coefficient

Climb Bio  ABVC Biopharma

Very weak diversification

The 3 months correlation between Climb and ABVC is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Climb Bio and ABVC Biopharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABVC Biopharma and Climb 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 Climb Bio are associated (or correlated) with ABVC Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABVC Biopharma has no effect on the direction of Climb Bio i.e., Climb Bio and ABVC Biopharma go up and down completely randomly.

Pair Corralation between Climb Bio and ABVC Biopharma

Given the investment horizon of 90 days Climb Bio is expected to generate 1.26 times less return on investment than ABVC Biopharma. But when comparing it to its historical volatility, Climb Bio is 1.85 times less risky than ABVC Biopharma. It trades about 0.25 of its potential returns per unit of risk. ABVC Biopharma is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  138.00  in ABVC Biopharma on May 27, 2025 and sell it today you would earn a total of  155.00  from holding ABVC Biopharma or generate 112.32% return on investment over 90 days.

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

Climb Bio  vs.  ABVC Biopharma

Climb Bio

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Climb Bio are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Climb Bio displayed solid returns over the last few months and may actually be approaching a breakup point.

ABVC Biopharma

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ABVC Biopharma are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, ABVC Biopharma exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Climb Bio and ABVC Biopharma

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

The idea behind Climb Bio and ABVC Biopharma 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.