Correlation Between Protek Capital and ProntoForms

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

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

Diversification Opportunities for Protek Capital and ProntoForms

0.0

Correlation Coefficient

Protek Capital  ProntoForms

Pay attention - limited upside

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

Pair Corralation between Protek Capital and ProntoForms

If you would invest (100.00) in ProntoForms on December 28, 2024 and sell it today you would earn a total of  100.00  from holding ProntoForms 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

Protek Capital  vs.  ProntoForms

Protek Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Protek Capital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent 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.

ProntoForms

Risk-Adjusted Performance

Very Weak

Over the last 90 days ProntoForms has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ProntoForms is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Protek Capital and ProntoForms

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

The idea behind Protek Capital and ProntoForms 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.