Correlation Between Adval Tech and Logitech International
Can any of the company-specific risk be diversified away by investing in both Adval Tech and Logitech International 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 Adval Tech and Logitech International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adval Tech Holding and Logitech International SA, you can compare the effects of market volatilities on Adval Tech and Logitech International 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 Adval Tech with a short position of Logitech International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adval Tech and Logitech International.
Diversification Opportunities for Adval Tech and Logitech International
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Adval and Logitech is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Adval Tech Holding and Logitech International SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logitech International and Adval Tech 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 Adval Tech Holding are associated (or correlated) with Logitech International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logitech International has no effect on the direction of Adval Tech i.e., Adval Tech and Logitech International go up and down completely randomly.
Pair Corralation between Adval Tech and Logitech International
Assuming the 90 days trading horizon Adval Tech Holding is expected to under-perform the Logitech International. In addition to that, Adval Tech is 1.5 times more volatile than Logitech International SA. It trades about -0.08 of its total potential returns per unit of risk. Logitech International SA is currently generating about 0.0 per unit of volatility. If you would invest 7,423 in Logitech International SA on September 1, 2024 and sell it today you would lose (273.00) from holding Logitech International SA or give up 3.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 70.37% |
| Values | Daily Returns |
Adval Tech Holding vs. Logitech International SA
Performance |
| Timeline |
| Adval Tech Holding |
| Logitech International |
Adval Tech and Logitech International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adval Tech and Logitech International
The main advantage of trading using opposite Adval Tech and Logitech International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adval Tech position performs unexpectedly, Logitech International 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 Logitech International will offset losses from the drop in Logitech International's long position.| Adval Tech vs. Feintool International Holding | Adval Tech vs. Also Holding AG | Adval Tech vs. Allreal Holding | Adval Tech vs. Forbo Holding AG |
| Logitech International vs. Geberit AG | Logitech International vs. Sika AG | Logitech International vs. Lonza Group AG | Logitech International vs. Swiss Life Holding |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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