Correlation Between Progressive Planet and Searchlight Resources
Can any of the company-specific risk be diversified away by investing in both Progressive Planet and Searchlight Resources 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 Searchlight Resources 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 Searchlight Resources, you can compare the effects of market volatilities on Progressive Planet and Searchlight Resources 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 Searchlight Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progressive Planet and Searchlight Resources.
Diversification Opportunities for Progressive Planet and Searchlight Resources
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Progressive and Searchlight is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Progressive Planet Solutions and Searchlight Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Searchlight Resources 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 Searchlight Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Searchlight Resources has no effect on the direction of Progressive Planet i.e., Progressive Planet and Searchlight Resources go up and down completely randomly.
Pair Corralation between Progressive Planet and Searchlight Resources
Assuming the 90 days horizon Progressive Planet is expected to generate 1.19 times less return on investment than Searchlight Resources. But when comparing it to its historical volatility, Progressive Planet Solutions is 3.28 times less risky than Searchlight Resources. It trades about 0.25 of its potential returns per unit of risk. Searchlight Resources is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 0.59 in Searchlight Resources on August 25, 2024 and sell it today you would lose (0.06) from holding Searchlight Resources or give up 10.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Progressive Planet Solutions vs. Searchlight Resources
Performance |
| Timeline |
| Progressive Planet |
| Searchlight Resources |
Progressive Planet and Searchlight Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Progressive Planet and Searchlight Resources
The main advantage of trading using opposite Progressive Planet and Searchlight Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Progressive Planet position performs unexpectedly, Searchlight Resources 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 Searchlight Resources will offset losses from the drop in Searchlight Resources' long position.| Progressive Planet vs. Norra Metals Corp | Progressive Planet vs. Amarc Resources | Progressive Planet vs. ZincX Resources Corp | Progressive Planet vs. Nuinsco Resources Limited |
| Searchlight Resources vs. Pampa Metals | Searchlight Resources vs. Progressive Planet Solutions | Searchlight Resources vs. Durango Resources | Searchlight Resources vs. Avarone Metals |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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