Correlation Between Aarons and PROG Holdings
Can any of the company-specific risk be diversified away by investing in both Aarons and PROG Holdings 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 Aarons and PROG Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Aarons and PROG Holdings, you can compare the effects of market volatilities on Aarons and PROG Holdings 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 Aarons with a short position of PROG Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aarons and PROG Holdings.
Diversification Opportunities for Aarons and PROG Holdings
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aarons and PROG is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding The Aarons and PROG Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PROG Holdings and Aarons 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 The Aarons are associated (or correlated) with PROG Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PROG Holdings has no effect on the direction of Aarons i.e., Aarons and PROG Holdings go up and down completely randomly.
Pair Corralation between Aarons and PROG Holdings
Considering the 90-day investment horizon The Aarons is expected to under-perform the PROG Holdings. In addition to that, Aarons is 1.35 times more volatile than PROG Holdings. It trades about 0.0 of its total potential returns per unit of risk. PROG Holdings is currently generating about 0.07 per unit of volatility. If you would invest 2,350 in PROG Holdings on August 27, 2024 and sell it today you would earn a total of 2,393 from holding PROG Holdings or generate 101.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 92.09% |
| Values | Daily Returns |
The Aarons vs. PROG Holdings
Performance |
| Timeline |
| Aarons |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| PROG Holdings |
Aarons and PROG Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aarons and PROG Holdings
The main advantage of trading using opposite Aarons and PROG Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aarons position performs unexpectedly, PROG Holdings 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 PROG Holdings will offset losses from the drop in PROG Holdings' long position.| Aarons vs. Custom Truck One | Aarons vs. PROG Holdings | Aarons vs. McGrath RentCorp | Aarons vs. HE Equipment Services |
| PROG Holdings vs. Adtalem Global Education | PROG Holdings vs. Enerpac Tool Group | PROG Holdings vs. Piper Sandler Companies |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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