Correlation Between Progress Software and Photronics
Can any of the company-specific risk be diversified away by investing in both Progress Software and Photronics 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 Progress Software and Photronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Progress Software and Photronics, you can compare the effects of market volatilities on Progress Software and Photronics 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 Progress Software with a short position of Photronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progress Software and Photronics.
Diversification Opportunities for Progress Software and Photronics
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Progress and Photronics is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Progress Software and Photronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Photronics and Progress Software 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 Progress Software are associated (or correlated) with Photronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Photronics has no effect on the direction of Progress Software i.e., Progress Software and Photronics go up and down completely randomly.
Pair Corralation between Progress Software and Photronics
Given the investment horizon of 90 days Progress Software is expected to under-perform the Photronics. But the stock apears to be less risky and, when comparing its historical volatility, Progress Software is 1.28 times less risky than Photronics. The stock trades about -0.03 of its potential returns per unit of risk. The Photronics is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2,200 in Photronics on June 3, 2025 and sell it today you would earn a total of 67.00 from holding Photronics or generate 3.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Progress Software vs. Photronics
Performance |
| Timeline |
| Progress Software |
| Photronics |
Progress Software and Photronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Progress Software and Photronics
The main advantage of trading using opposite Progress Software and Photronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Progress Software position performs unexpectedly, Photronics 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 Photronics will offset losses from the drop in Photronics' long position.| Progress Software vs. Crowdstrike Holdings | Progress Software vs. CoreWeave, Class A | Progress Software vs. Palo Alto Networks | Progress Software vs. Core Scientific, Common |
| Photronics vs. Aehr Test Systems | Photronics vs. Lam Research Corp | Photronics vs. KLA Tencor | Photronics vs. Kulicke and Soffa |
Check out your portfolio center.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 CEOs Directory module to screen CEOs from public companies around the world.
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