Correlation Between Progressive Corp and AmTrust Financial

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

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

Diversification Opportunities for Progressive Corp and AmTrust Financial

-0.41

Correlation Coefficient

Progressive Corp  AmTrust Financial

Very good diversification

The 3 months correlation between Progressive and AmTrust is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Progressive Corp and AmTrust Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AmTrust Financial and Progressive Corp 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 Progressive Corp are associated (or correlated) with AmTrust Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AmTrust Financial has no effect on the direction of Progressive Corp i.e., Progressive Corp and AmTrust Financial go up and down completely randomly.

Pair Corralation between Progressive Corp and AmTrust Financial

Considering the 90-day investment horizon Progressive Corp is expected to under-perform the AmTrust Financial. But the stock apears to be less risky and, when comparing its historical volatility, Progressive Corp is 4.9 times less risky than AmTrust Financial. The stock trades about -0.1 of its potential returns per unit of risk. The AmTrust Financial Services is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1,383  in AmTrust Financial Services on July 1, 2025 and sell it today you would earn a total of  178.00  from holding AmTrust Financial Services or generate 12.87% return on investment over 90 days.

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

Progressive Corp  vs.  AmTrust Financial Services

Progressive Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days Progressive Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest conflicting performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

AmTrust Financial

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in AmTrust Financial Services are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak forward indicators, AmTrust Financial reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Progressive Corp and AmTrust Financial

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

The idea behind Progressive Corp and AmTrust Financial Services 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.