Correlation Between NYSE Composite and Progressive Corp
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Progressive Corp 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 NYSE Composite and Progressive Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Progressive Corp, you can compare the effects of market volatilities on NYSE Composite and Progressive Corp 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 NYSE Composite with a short position of Progressive Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Progressive Corp.
Diversification Opportunities for NYSE Composite and Progressive Corp
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and Progressive is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Progressive Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progressive Corp and NYSE Composite 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 NYSE Composite are associated (or correlated) with Progressive Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progressive Corp has no effect on the direction of NYSE Composite i.e., NYSE Composite and Progressive Corp go up and down completely randomly.
Pair Corralation between NYSE Composite and Progressive Corp
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the Progressive Corp. But the index apears to be less risky and, when comparing its historical volatility, NYSE Composite is 1.76 times less risky than Progressive Corp. The index trades about -0.12 of its potential returns per unit of risk. The Progressive Corp is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 21,100 in Progressive Corp on February 5, 2024 and sell it today you would lose (228.00) from holding Progressive Corp or give up 1.08% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
NYSE Composite vs. Progressive Corp
Performance |
Timeline |
NYSE Composite and Progressive Corp Volatility Contrast
Predicted Return Density |
Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Progressive Corp
Pair trading matchups for Progressive Corp
Pair Trading with NYSE Composite and Progressive Corp
The main advantage of trading using opposite NYSE Composite and Progressive Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Progressive Corp 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 Progressive Corp will offset losses from the drop in Progressive Corp's long position.NYSE Composite vs. Bridgford Foods | NYSE Composite vs. SunOpta | NYSE Composite vs. Where Food Comes | NYSE Composite vs. Sligro Food Group |
Progressive Corp vs. The Travelers Companies | Progressive Corp vs. Chubb | Progressive Corp vs. Cincinnati Financial | Progressive Corp vs. W R Berkley |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |