Correlation Between Gorman Rupp and PROG Holdings

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

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

Diversification Opportunities for Gorman Rupp and PROG Holdings

-0.22

Correlation Coefficient

Gorman Rupp  PROG Holdings

Very good diversification

The 3 months correlation between Gorman and PROG is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Gorman Rupp and PROG Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PROG Holdings and Gorman Rupp 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 Gorman Rupp are associated (or correlated) with PROG Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PROG Holdings has no effect on the direction of Gorman Rupp i.e., Gorman Rupp and PROG Holdings go up and down completely randomly.

Pair Corralation between Gorman Rupp and PROG Holdings

Considering the 90-day investment horizon Gorman Rupp is expected to generate 0.87 times more return on investment than PROG Holdings. However, Gorman Rupp is 1.15 times less risky than PROG Holdings. It trades about 0.13 of its potential returns per unit of risk. PROG Holdings is currently generating about -0.01 per unit of risk. If you would invest  4,095  in Gorman Rupp on July 30, 2025 and sell it today you would earn a total of  537.00  from holding Gorman Rupp or generate 13.11% return on investment over 90 days.

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

Gorman Rupp  vs.  PROG Holdings

Gorman Rupp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Gorman Rupp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Gorman Rupp exhibited solid returns over the last few months and may actually be approaching a breakup point.

PROG Holdings

Risk-Adjusted Performance

Weakest

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

Pair Trading with Gorman Rupp and PROG Holdings

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

The idea behind Gorman Rupp and PROG 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.