Correlation Between Progressive Planet and Sterling Metals
Can any of the company-specific risk be diversified away by investing in both Progressive Planet and Sterling Metals 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 Progressive Planet and Sterling Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Progressive Planet Solutions and Sterling Metals Corp, you can compare the effects of market volatilities on Progressive Planet and Sterling Metals 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 Progressive Planet with a short position of Sterling Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progressive Planet and Sterling Metals.
Diversification Opportunities for Progressive Planet and Sterling Metals
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Progressive and Sterling is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Progressive Planet Solutions and Sterling Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Metals Corp and Progressive Planet 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 Progressive Planet Solutions are associated (or correlated) with Sterling Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Metals Corp has no effect on the direction of Progressive Planet i.e., Progressive Planet and Sterling Metals go up and down completely randomly.
Pair Corralation between Progressive Planet and Sterling Metals
Assuming the 90 days horizon Progressive Planet is expected to generate 10.54 times less return on investment than Sterling Metals. But when comparing it to its historical volatility, Progressive Planet Solutions is 2.29 times less risky than Sterling Metals. It trades about 0.01 of its potential returns per unit of risk. Sterling Metals Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Sterling Metals Corp on October 25, 2024 and sell it today you would lose (13.58) from holding Sterling Metals Corp or give up 79.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Progressive Planet Solutions vs. Sterling Metals Corp
Performance |
| Timeline |
| Progressive Planet |
| Sterling Metals Corp |
Progressive Planet and Sterling Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Progressive Planet and Sterling Metals
The main advantage of trading using opposite Progressive Planet and Sterling Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Progressive Planet position performs unexpectedly, Sterling Metals 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 Sterling Metals will offset losses from the drop in Sterling Metals' long position.| Progressive Planet vs. Avarone Metals | Progressive Planet vs. Amarc Resources | Progressive Planet vs. Huntsman Exploration | Progressive Planet vs. Adriatic Metals PLC |
| Sterling Metals vs. Progressive Planet Solutions | Sterling Metals vs. Durango Resources | Sterling Metals vs. Avarone Metals | Sterling Metals vs. Mundoro Capital |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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