Correlation Between Logah Technology and Aces Electronics
Can any of the company-specific risk be diversified away by investing in both Logah Technology and Aces Electronics 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 Logah Technology and Aces Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Logah Technology Corp and Aces Electronics Co, you can compare the effects of market volatilities on Logah Technology and Aces Electronics 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 Logah Technology with a short position of Aces Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Logah Technology and Aces Electronics.
Diversification Opportunities for Logah Technology and Aces Electronics
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Logah and Aces is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Logah Technology Corp and Aces Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aces Electronics and Logah Technology 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 Logah Technology Corp are associated (or correlated) with Aces Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aces Electronics has no effect on the direction of Logah Technology i.e., Logah Technology and Aces Electronics go up and down completely randomly.
Pair Corralation between Logah Technology and Aces Electronics
Assuming the 90 days trading horizon Logah Technology Corp is expected to generate 1.89 times more return on investment than Aces Electronics. However, Logah Technology is 1.89 times more volatile than Aces Electronics Co. It trades about -0.07 of its potential returns per unit of risk. Aces Electronics Co is currently generating about -0.28 per unit of risk. If you would invest 804.00 in Logah Technology Corp on October 11, 2024 and sell it today you would lose (44.00) from holding Logah Technology Corp or give up 5.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Logah Technology Corp vs. Aces Electronics Co
Performance |
| Timeline |
| Logah Technology Corp |
| Aces Electronics |
Logah Technology and Aces Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Logah Technology and Aces Electronics
The main advantage of trading using opposite Logah Technology and Aces Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logah Technology position performs unexpectedly, Aces Electronics 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 Aces Electronics will offset losses from the drop in Aces Electronics' long position.| Logah Technology vs. Aces Electronics Co | Logah Technology vs. Nichidenbo Corp | Logah Technology vs. Cheer Time Enterprise | Logah Technology vs. Edison Opto Corp |
| Aces Electronics vs. Chant Sincere Co | Aces Electronics vs. Altek Corp | Aces Electronics vs. Jentech Precision Industrial | Aces Electronics vs. Lotes Co |
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 Stocks Directory module to find actively traded stocks across global markets.
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