Correlation Between PROG Holdings and Multi Ways
Can any of the company-specific risk be diversified away by investing in both PROG Holdings and Multi Ways 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 PROG Holdings and Multi Ways into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PROG Holdings and Multi Ways Holdings, you can compare the effects of market volatilities on PROG Holdings and Multi Ways 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 PROG Holdings with a short position of Multi Ways. Check out your portfolio center. Please also check ongoing floating volatility patterns of PROG Holdings and Multi Ways.
Diversification Opportunities for PROG Holdings and Multi Ways
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PROG and Multi is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding PROG Holdings and Multi Ways Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Ways Holdings and PROG Holdings 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 PROG Holdings are associated (or correlated) with Multi Ways. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Ways Holdings has no effect on the direction of PROG Holdings i.e., PROG Holdings and Multi Ways go up and down completely randomly.
Pair Corralation between PROG Holdings and Multi Ways
Considering the 90-day investment horizon PROG Holdings is expected to generate 0.56 times more return on investment than Multi Ways. However, PROG Holdings is 1.77 times less risky than Multi Ways. It trades about 0.24 of its potential returns per unit of risk. Multi Ways Holdings is currently generating about -0.14 per unit of risk. If you would invest 4,198 in PROG Holdings on August 26, 2024 and sell it today you would earn a total of 545.00 from holding PROG Holdings or generate 12.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PROG Holdings vs. Multi Ways Holdings
Performance |
| Timeline |
| PROG Holdings |
| Multi Ways Holdings |
PROG Holdings and Multi Ways Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PROG Holdings and Multi Ways
The main advantage of trading using opposite PROG Holdings and Multi Ways positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PROG Holdings position performs unexpectedly, Multi Ways 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 Multi Ways will offset losses from the drop in Multi Ways' long position.| PROG Holdings vs. Adtalem Global Education | PROG Holdings vs. Enerpac Tool Group | PROG Holdings vs. Piper Sandler Companies |
| Multi Ways vs. FlexShopper | Multi Ways vs. Hertz Global Holdings | Multi Ways vs. HyreCar | Multi Ways vs. Avis Budget Group |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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