Correlation Between PROG Holdings and Aarons

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

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

Diversification Opportunities for PROG Holdings and Aarons

0.0

Correlation Coefficient

PROG Holdings  Aarons

Pay attention - limited upside

The 3 months correlation between PROG and Aarons is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PROG Holdings and The Aarons in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aarons and PROG Holdings 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 PROG Holdings are associated (or correlated) with Aarons. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aarons has no effect on the direction of PROG Holdings i.e., PROG Holdings and Aarons go up and down completely randomly.

Pair Corralation between PROG Holdings and Aarons

If you would invest (100.00) in The Aarons on December 27, 2024 and sell it today you would earn a total of  100.00  from holding The Aarons or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

PROG Holdings  vs.  The Aarons

PROG Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days PROG Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Aarons

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Aarons has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Aarons is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with PROG Holdings and Aarons

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

The idea behind PROG Holdings and The Aarons 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.