Correlation Between Logitech International and Zuger Kantonalbank
Can any of the company-specific risk be diversified away by investing in both Logitech International and Zuger Kantonalbank 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 Zuger Kantonalbank 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 Zuger Kantonalbank, you can compare the effects of market volatilities on Logitech International and Zuger Kantonalbank 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 Zuger Kantonalbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Logitech International and Zuger Kantonalbank.
Diversification Opportunities for Logitech International and Zuger Kantonalbank
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Logitech and Zuger is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Logitech International SA and Zuger Kantonalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zuger Kantonalbank 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 Zuger Kantonalbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zuger Kantonalbank has no effect on the direction of Logitech International i.e., Logitech International and Zuger Kantonalbank go up and down completely randomly.
Pair Corralation between Logitech International and Zuger Kantonalbank
Assuming the 90 days trading horizon Logitech International SA is expected to generate 4.34 times more return on investment than Zuger Kantonalbank. However, Logitech International is 4.34 times more volatile than Zuger Kantonalbank. It trades about 0.01 of its potential returns per unit of risk. Zuger Kantonalbank is currently generating about -0.07 per unit of risk. If you would invest 7,218 in Logitech International SA on September 5, 2024 and sell it today you would earn a total of 12.00 from holding Logitech International SA or generate 0.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Logitech International SA vs. Zuger Kantonalbank
Performance |
| Timeline |
| Logitech International |
| Zuger Kantonalbank |
Logitech International and Zuger Kantonalbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Logitech International and Zuger Kantonalbank
The main advantage of trading using opposite Logitech International and Zuger Kantonalbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logitech International position performs unexpectedly, Zuger Kantonalbank 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 Zuger Kantonalbank will offset losses from the drop in Zuger Kantonalbank's long position.| Logitech International vs. Geberit AG | Logitech International vs. Sika AG | Logitech International vs. Lonza Group AG | Logitech International vs. Swiss Life Holding |
| Zuger Kantonalbank vs. Helvetia Holding AG | Zuger Kantonalbank vs. Swiss Life Holding | Zuger Kantonalbank vs. Baloise Holding AG | Zuger Kantonalbank vs. Logitech International SA |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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