Correlation Between Prog Hldgs and Akamai Technologies

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Can any of the company-specific risk be diversified away by investing in both Prog Hldgs and Akamai Technologies 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 Prog Hldgs and Akamai Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prog Hldgs and Akamai Technologies, you can compare the effects of market volatilities on Prog Hldgs and Akamai Technologies 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 Prog Hldgs with a short position of Akamai Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prog Hldgs and Akamai Technologies.

Diversification Opportunities for Prog Hldgs and Akamai Technologies

0.54
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Prog Hldgs and Akamai is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Prog Hldgs and Akamai Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akamai Technologies and Prog Hldgs 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 Prog Hldgs are associated (or correlated) with Akamai Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akamai Technologies has no effect on the direction of Prog Hldgs i.e., Prog Hldgs and Akamai Technologies go up and down completely randomly.

Pair Corralation between Prog Hldgs and Akamai Technologies

Considering the 90-day investment horizon Prog Hldgs is expected to generate 1.54 times more return on investment than Akamai Technologies. However, Prog Hldgs is 1.54 times more volatile than Akamai Technologies. It trades about -0.12 of its potential returns per unit of risk. Akamai Technologies is currently generating about -0.3 per unit of risk. If you would invest  1,877  in Prog Hldgs on June 30, 2022 and sell it today you would lose (133.00)  from holding Prog Hldgs or give up 7.09% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Prog Hldgs  vs.  Akamai Technologies

 Performance (%) 
       Timeline  
Prog Hldgs 
Prog Hldgs Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Prog Hldgs are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting basic indicators, Prog Hldgs may actually be approaching a critical reversion point that can send shares even higher in October 2022.

Prog Hldgs Price Channel

Akamai Technologies 
Akamai Performance
0 of 100
Over the last 90 days Akamai Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain steady and the new chaos on Wall Street may also be a sign of medium-term gains for the company stakeholders.

Akamai Price Channel

Prog Hldgs and Akamai Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Prog Hldgs and Akamai Technologies

The main advantage of trading using opposite Prog Hldgs and Akamai Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prog Hldgs position performs unexpectedly, Akamai Technologies 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 Akamai Technologies will offset losses from the drop in Akamai Technologies' long position.
Prog Hldgs vs. Amazon Inc
The idea behind Prog Hldgs and Akamai Technologies 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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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.

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