Correlation Between Kemper and Progressive Corp

Can any of the company-specific risk be diversified away by investing in both Kemper 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 Kemper and Progressive Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kemper and Progressive Corp, you can compare the effects of market volatilities on Kemper 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 Kemper with a short position of Progressive Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kemper and Progressive Corp.

Diversification Opportunities for Kemper and Progressive Corp

0.44

Correlation Coefficient

Kemper  Progressive Corp

Very weak diversification

The 3 months correlation between Kemper and Progressive is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Kemper and Progressive Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progressive Corp and Kemper 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 Kemper 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 Kemper i.e., Kemper and Progressive Corp go up and down completely randomly.

Pair Corralation between Kemper and Progressive Corp

Given the investment horizon of 90 days Kemper is expected to under-perform the Progressive Corp. In addition to that, Kemper is 1.13 times more volatile than Progressive Corp. It trades about -0.09 of its total potential returns per unit of risk. Progressive Corp is currently generating about 0.05 per unit of volatility. If you would invest  26,363  in Progressive Corp on November 29, 2024 and sell it today you would earn a total of  980.00  from holding Progressive Corp or generate 3.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Kemper  vs.  Progressive Corp

Kemper

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kemper has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest inconsistent performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Progressive Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Progressive Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable technical and fundamental indicators, Progressive Corp is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Kemper and Progressive Corp

The main advantage of trading using opposite Kemper and Progressive Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kemper 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.

The idea behind Kemper and Progressive Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.