Correlation Between PROS Holdings and Ke Holdings
Can any of the company-specific risk be diversified away by investing in both PROS Holdings and Ke 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 PROS Holdings and Ke Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PROS Holdings and Ke Holdings, you can compare the effects of market volatilities on PROS Holdings and Ke 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 PROS Holdings with a short position of Ke Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of PROS Holdings and Ke Holdings.
Diversification Opportunities for PROS Holdings and Ke Holdings
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between PROS and BEKE is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding PROS Holdings and Ke Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ke Holdings and PROS 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 PROS Holdings are associated (or correlated) with Ke Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ke Holdings has no effect on the direction of PROS Holdings i.e., PROS Holdings and Ke Holdings go up and down completely randomly.
Pair Corralation between PROS Holdings and Ke Holdings
Considering the 90-day investment horizon PROS Holdings is expected to under-perform the Ke Holdings. But the stock apears to be less risky and, when comparing its historical volatility, PROS Holdings is 1.29 times less risky than Ke Holdings. The stock trades about -0.05 of its potential returns per unit of risk. The Ke Holdings is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,473 in Ke Holdings on September 3, 2024 and sell it today you would earn a total of 458.00 from holding Ke Holdings or generate 31.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PROS Holdings vs. Ke Holdings
Performance |
| Timeline |
| PROS Holdings |
| Ke Holdings |
PROS Holdings and Ke Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PROS Holdings and Ke Holdings
The main advantage of trading using opposite PROS Holdings and Ke Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PROS Holdings position performs unexpectedly, Ke 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 Ke Holdings will offset losses from the drop in Ke Holdings' long position.| PROS Holdings vs. Meridianlink | PROS Holdings vs. Enfusion | PROS Holdings vs. PDF Solutions | PROS Holdings vs. ePlus inc |
| Ke Holdings vs. Marcus Millichap | Ke Holdings vs. Digitalbridge Group | Ke Holdings vs. Jones Lang LaSalle | Ke Holdings vs. CBRE Group Class |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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