Correlation Between SSC Technologies and PROS Holdings
Can any of the company-specific risk be diversified away by investing in both SSC Technologies and PROS 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 SSC Technologies and PROS Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SSC Technologies Holdings and PROS Holdings, you can compare the effects of market volatilities on SSC Technologies and PROS 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 SSC Technologies with a short position of PROS Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSC Technologies and PROS Holdings.
Diversification Opportunities for SSC Technologies and PROS Holdings
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SSC and PROS is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding SSC Technologies Holdings and PROS Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PROS Holdings and SSC Technologies 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 SSC Technologies Holdings are associated (or correlated) with PROS Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PROS Holdings has no effect on the direction of SSC Technologies i.e., SSC Technologies and PROS Holdings go up and down completely randomly.
Pair Corralation between SSC Technologies and PROS Holdings
Given the investment horizon of 90 days SSC Technologies is expected to generate 2.93 times less return on investment than PROS Holdings. But when comparing it to its historical volatility, SSC Technologies Holdings is 4.32 times less risky than PROS Holdings. It trades about 0.18 of its potential returns per unit of risk. PROS Holdings is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,267 in PROS Holdings on September 12, 2024 and sell it today you would earn a total of 211.00 from holding PROS Holdings or generate 9.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SSC Technologies Holdings vs. PROS Holdings
Performance |
| Timeline |
| SSC Technologies Holdings |
| PROS Holdings |
SSC Technologies and PROS Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSC Technologies and PROS Holdings
The main advantage of trading using opposite SSC Technologies and PROS Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSC Technologies position performs unexpectedly, PROS 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 PROS Holdings will offset losses from the drop in PROS Holdings' long position.| SSC Technologies vs. Aspen Technology | SSC Technologies vs. Bentley Systems | SSC Technologies vs. Tyler Technologies | SSC Technologies vs. Blackbaud |
| PROS Holdings vs. Meridianlink | PROS Holdings vs. Enfusion | PROS Holdings vs. PDF Solutions | PROS Holdings vs. ePlus inc |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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