Correlation Between Primoris Services and Orion Group

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

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

Diversification Opportunities for Primoris Services and Orion Group

0.82

Correlation Coefficient

Primoris Services  Orion Group

Very poor diversification

The 3 months correlation between Primoris and Orion is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Primoris Services and Orion Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orion Group Holdings and Primoris Services 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 Primoris Services are associated (or correlated) with Orion Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orion Group Holdings has no effect on the direction of Primoris Services i.e., Primoris Services and Orion Group go up and down completely randomly.

Pair Corralation between Primoris Services and Orion Group

Given the investment horizon of 90 days Primoris Services is expected to generate 0.84 times more return on investment than Orion Group. However, Primoris Services is 1.2 times less risky than Orion Group. It trades about -0.1 of its potential returns per unit of risk. Orion Group Holdings is currently generating about -0.09 per unit of risk. If you would invest  7,674  in Primoris Services on December 29, 2024 and sell it today you would lose (1,947) from holding Primoris Services or give up 25.37% of portfolio value over 90 days.

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

Primoris Services  vs.  Orion Group Holdings

Primoris Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days Primoris Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's forward indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Orion Group Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Orion Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Primoris Services and Orion Group

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

The idea behind Primoris Services and Orion Group Holdings 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 Stocks Directory module to find actively traded stocks across global markets.