Correlation Between Logitech International and Cicor Technologies
Can any of the company-specific risk be diversified away by investing in both Logitech International and Cicor Technologies 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 Logitech International and Cicor Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Logitech International SA and Cicor Technologies, you can compare the effects of market volatilities on Logitech International and Cicor Technologies 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 Logitech International with a short position of Cicor Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Logitech International and Cicor Technologies.
Diversification Opportunities for Logitech International and Cicor Technologies
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Logitech and Cicor is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Logitech International SA and Cicor Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cicor Technologies and Logitech International 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 Logitech International SA are associated (or correlated) with Cicor Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cicor Technologies has no effect on the direction of Logitech International i.e., Logitech International and Cicor Technologies go up and down completely randomly.
Pair Corralation between Logitech International and Cicor Technologies
Assuming the 90 days trading horizon Logitech International SA is expected to generate 1.41 times more return on investment than Cicor Technologies. However, Logitech International is 1.41 times more volatile than Cicor Technologies. It trades about 0.33 of its potential returns per unit of risk. Cicor Technologies is currently generating about -0.11 per unit of risk. If you would invest 6,828 in Logitech International SA on September 13, 2024 and sell it today you would earn a total of 716.00 from holding Logitech International SA or generate 10.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Logitech International SA vs. Cicor Technologies
Performance |
| Timeline |
| Logitech International |
| Cicor Technologies |
Logitech International and Cicor Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Logitech International and Cicor Technologies
The main advantage of trading using opposite Logitech International and Cicor Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logitech International position performs unexpectedly, Cicor Technologies 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 Cicor Technologies will offset losses from the drop in Cicor Technologies' long position.| Logitech International vs. Geberit AG | Logitech International vs. Sika AG | Logitech International vs. Lonza Group AG | Logitech International vs. Swiss Life Holding |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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