Correlation Between Progressive Corp and Alleghany
Can any of the company-specific risk be diversified away by investing in both Progressive Corp and Alleghany 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 Progressive Corp and Alleghany into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Progressive Corp and Alleghany, you can compare the effects of market volatilities on Progressive Corp and Alleghany 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 Progressive Corp with a short position of Alleghany. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progressive Corp and Alleghany.
Diversification Opportunities for Progressive Corp and Alleghany
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Progressive and Alleghany is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Progressive Corp and Alleghany in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alleghany and Progressive Corp 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 Progressive Corp are associated (or correlated) with Alleghany. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alleghany has no effect on the direction of Progressive Corp i.e., Progressive Corp and Alleghany go up and down completely randomly.
Pair Corralation between Progressive Corp and Alleghany
If you would invest 20,562 in Progressive Corp on January 20, 2024 and sell it today you would earn a total of 413.00 from holding Progressive Corp or generate 2.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
Progressive Corp vs. Alleghany
Performance |
| Timeline |
| Progressive Corp |
| Alleghany |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Progressive Corp and Alleghany Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Progressive Corp and Alleghany
The main advantage of trading using opposite Progressive Corp and Alleghany positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Progressive Corp position performs unexpectedly, Alleghany 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 Alleghany will offset losses from the drop in Alleghany's long position.| Progressive Corp vs. The Travelers Companies | Progressive Corp vs. Chubb | Progressive Corp vs. Cincinnati Financial | Progressive Corp vs. W R Berkley |
| Alleghany vs. Arhaus Inc | Alleghany vs. Simon Property Group | Alleghany vs. Paysafe | Alleghany vs. Valneva SE ADR |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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