Correlation Between Staffing 360 and Trucept

Can any of the company-specific risk be diversified away by investing in both Staffing 360 and Trucept 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 Staffing 360 and Trucept into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Staffing 360 Solutions and Trucept, you can compare the effects of market volatilities on Staffing 360 and Trucept 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 Staffing 360 with a short position of Trucept. Check out your portfolio center. Please also check ongoing floating volatility patterns of Staffing 360 and Trucept.

Diversification Opportunities for Staffing 360 and Trucept

-0.23

Correlation Coefficient

Staffing 360  Trucept

Very good diversification

The 3 months correlation between Staffing and Trucept is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Staffing 360 Solutions and Trucept in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trucept and Staffing 360 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 Staffing 360 Solutions are associated (or correlated) with Trucept. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trucept has no effect on the direction of Staffing 360 i.e., Staffing 360 and Trucept go up and down completely randomly.

Pair Corralation between Staffing 360 and Trucept

Given the investment horizon of 90 days Staffing 360 Solutions is expected to under-perform the Trucept. But the stock apears to be less risky and, when comparing its historical volatility, Staffing 360 Solutions is 1.4 times less risky than Trucept. The stock trades about -0.57 of its potential returns per unit of risk. The Trucept is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  3.50  in Trucept on January 25, 2025 and sell it today you would earn a total of  1.43  from holding Trucept or generate 40.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	22.22%
Values	Daily Returns

Staffing 360 Solutions  vs.  Trucept

Staffing 360 Solutions

Risk-Adjusted Performance

Very Weak

Over the last 90 days Staffing 360 Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Trucept

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Trucept are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating technical and fundamental indicators, Trucept reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Staffing 360 and Trucept

The main advantage of trading using opposite Staffing 360 and Trucept positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Staffing 360 position performs unexpectedly, Trucept 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 Trucept will offset losses from the drop in Trucept's long position.

The idea behind Staffing 360 Solutions and Trucept 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.