Correlation Between Prog Hldgs and Continental

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

Diversification Opportunities for Prog Hldgs and Continental

0.6
  Correlation Coefficient

Poor diversification

The 3 months correlation between Prog Hldgs and Continental is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Prog Hldgs and Caleres in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Continental 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 Continental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Continental has no effect on the direction of Prog Hldgs i.e., Prog Hldgs and Continental go up and down completely randomly.

Pair Corralation between Prog Hldgs and Continental

Considering the 90-day investment horizon Prog Hldgs is expected to under-perform the Continental. In addition to that, Prog Hldgs is 1.17 times more volatile than Caleres. It trades about -0.03 of its total potential returns per unit of risk. Caleres is currently generating about 0.07 per unit of volatility. If you would invest  921.00  in Caleres on July 5, 2022 and sell it today you would earn a total of  1,539  from holding Caleres or generate 167.1% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy99.8%
ValuesDaily Returns

Prog Hldgs  vs.  Caleres

 Performance (%) 
       Timeline  
Prog Hldgs 
Prog Hldgs Performance
0 of 100
Over the last 90 days Prog Hldgs has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Prog Hldgs is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Prog Hldgs Price Channel

Continental 
Continental Performance
0 of 100
Over the last 90 days Caleres has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady basic indicators, Continental is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Continental Price Channel

Prog Hldgs and Continental Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Prog Hldgs and Continental

The main advantage of trading using opposite Prog Hldgs and Continental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prog Hldgs position performs unexpectedly, Continental 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 Continental will offset losses from the drop in Continental's long position.
Prog Hldgs vs. Amazon Inc
The idea behind Prog Hldgs and Caleres 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.
Continental vs. Amazon Inc
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

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