Correlation Between Proficient Auto and Eastman Kodak

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

By analyzing existing cross correlation between Proficient Auto Logistics, and Eastman Kodak Co, you can compare the effects of market volatilities on Proficient Auto and Eastman Kodak 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 Proficient Auto with a short position of Eastman Kodak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Proficient Auto and Eastman Kodak.

Diversification Opportunities for Proficient Auto and Eastman Kodak

-0.28

Correlation Coefficient

Proficient Auto  Eastman Kodak

Very good diversification

The 3 months correlation between Proficient and Eastman is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Proficient Auto Logistics, and Eastman Kodak Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Kodak and Proficient Auto 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 Proficient Auto Logistics, are associated (or correlated) with Eastman Kodak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastman Kodak has no effect on the direction of Proficient Auto i.e., Proficient Auto and Eastman Kodak go up and down completely randomly.

Pair Corralation between Proficient Auto and Eastman Kodak

Considering the 90-day investment horizon Proficient Auto Logistics, is expected to under-perform the Eastman Kodak. But the stock apears to be less risky and, when comparing its historical volatility, Proficient Auto Logistics, is 1.02 times less risky than Eastman Kodak. The stock trades about -0.17 of its potential returns per unit of risk. The Eastman Kodak Co is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  485.00  in Eastman Kodak Co on September 12, 2024 and sell it today you would earn a total of  188.00  from holding Eastman Kodak Co or generate 38.76% return on investment over 90 days.

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

Proficient Auto Logistics,  vs.  Eastman Kodak Co

Proficient Auto Logi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Proficient Auto Logistics, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Eastman Kodak

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eastman Kodak Co are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating fundamental indicators, Eastman Kodak disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Proficient Auto and Eastman Kodak

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

The idea behind Proficient Auto Logistics, and Eastman Kodak Co 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.