Correlation Between Progate and Champion Building
Can any of the company-specific risk be diversified away by investing in both Progate and Champion Building 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 Progate and Champion Building into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Progate Group and Champion Building Materials, you can compare the effects of market volatilities on Progate and Champion Building 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 Progate with a short position of Champion Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progate and Champion Building.
Diversification Opportunities for Progate and Champion Building
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Progate and Champion is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Progate Group and Champion Building Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Champion Building and Progate 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 Progate Group are associated (or correlated) with Champion Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Champion Building has no effect on the direction of Progate i.e., Progate and Champion Building go up and down completely randomly.
Pair Corralation between Progate and Champion Building
Assuming the 90 days trading horizon Progate Group is expected to under-perform the Champion Building. In addition to that, Progate is 1.75 times more volatile than Champion Building Materials. It trades about -0.13 of its total potential returns per unit of risk. Champion Building Materials is currently generating about 0.1 per unit of volatility. If you would invest 1,030 in Champion Building Materials on August 27, 2024 and sell it today you would earn a total of 35.00 from holding Champion Building Materials or generate 3.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Progate Group vs. Champion Building Materials
Performance |
| Timeline |
| Progate Group |
| Champion Building |
Progate and Champion Building Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Progate and Champion Building
The main advantage of trading using opposite Progate and Champion Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Progate position performs unexpectedly, Champion Building 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 Champion Building will offset losses from the drop in Champion Building's long position.| Progate vs. Winstek Semiconductor Co | Progate vs. Mospec Semiconductor Corp | Progate vs. WIN Semiconductors | Progate vs. Holtek Semiconductor |
| Champion Building vs. Sunny Friend Environmental | Champion Building vs. TTET Union Corp | Champion Building vs. ECOVE Environment Corp | Champion Building vs. Yulon Finance Corp |
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 the Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |