Correlation Between Cognex and Progress Software
Can any of the company-specific risk be diversified away by investing in both Cognex and Progress Software 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 Cognex and Progress Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cognex and Progress Software, you can compare the effects of market volatilities on Cognex and Progress Software 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 Cognex with a short position of Progress Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cognex and Progress Software.
Diversification Opportunities for Cognex and Progress Software
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cognex and Progress is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Cognex and Progress Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progress Software and Cognex 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 Cognex are associated (or correlated) with Progress Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progress Software has no effect on the direction of Cognex i.e., Cognex and Progress Software go up and down completely randomly.
Pair Corralation between Cognex and Progress Software
Given the investment horizon of 90 days Cognex is expected to generate 2.24 times less return on investment than Progress Software. In addition to that, Cognex is 1.75 times more volatile than Progress Software. It trades about 0.06 of its total potential returns per unit of risk. Progress Software is currently generating about 0.24 per unit of volatility. If you would invest 6,470 in Progress Software on August 29, 2024 and sell it today you would earn a total of 494.00 from holding Progress Software or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cognex vs. Progress Software
Performance |
| Timeline |
| Cognex |
| Progress Software |
Cognex and Progress Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cognex and Progress Software
The main advantage of trading using opposite Cognex and Progress Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cognex position performs unexpectedly, Progress Software 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 Progress Software will offset losses from the drop in Progress Software's long position.| Cognex vs. Vontier Corp | Cognex vs. Teledyne Technologies Incorporated | Cognex vs. ESCO Technologies | Cognex vs. MKS Instruments |
| Progress Software vs. ePlus inc | Progress Software vs. Agilysys | Progress Software vs. Sapiens International | Progress Software vs. PDF Solutions |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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