Correlation Between National Research and Progyny

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

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

Diversification Opportunities for National Research and Progyny

-0.31

Correlation Coefficient

National Research  Progyny

Very good diversification

The 3 months correlation between National and Progyny is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding National Research Corp and Progyny in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progyny and National Research 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 National Research Corp are associated (or correlated) with Progyny. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progyny has no effect on the direction of National Research i.e., National Research and Progyny go up and down completely randomly.

Pair Corralation between National Research and Progyny

Considering the 90-day investment horizon National Research Corp is expected to under-perform the Progyny. In addition to that, National Research is 1.25 times more volatile than Progyny. It trades about -0.11 of its total potential returns per unit of risk. Progyny is currently generating about 0.21 per unit of volatility. If you would invest  1,693  in Progyny on December 29, 2024 and sell it today you would earn a total of  538.00  from holding Progyny or generate 31.78% return on investment over 90 days.

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

National Research Corp  vs.  Progyny

National Research Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days National Research Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Progyny

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Progyny are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Progyny showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with National Research and Progyny

The main advantage of trading using opposite National Research and Progyny positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Research position performs unexpectedly, Progyny 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 Progyny will offset losses from the drop in Progyny's long position.

The idea behind National Research Corp and Progyny 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 Transaction History module to view history of all your transactions and understand their impact on performance.