Correlation Between Logan Ridge and Franklin Credit
Can any of the company-specific risk be diversified away by investing in both Logan Ridge and Franklin Credit 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 Logan Ridge and Franklin Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Logan Ridge Finance and Franklin Credit Management, you can compare the effects of market volatilities on Logan Ridge and Franklin Credit 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 Logan Ridge with a short position of Franklin Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Logan Ridge and Franklin Credit.
Diversification Opportunities for Logan Ridge and Franklin Credit
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Logan and Franklin is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Logan Ridge Finance and Franklin Credit Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Credit Mana and Logan Ridge 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 Logan Ridge Finance are associated (or correlated) with Franklin Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Credit Mana has no effect on the direction of Logan Ridge i.e., Logan Ridge and Franklin Credit go up and down completely randomly.
Pair Corralation between Logan Ridge and Franklin Credit
Given the investment horizon of 90 days Logan Ridge Finance is expected to generate 0.21 times more return on investment than Franklin Credit. However, Logan Ridge Finance is 4.79 times less risky than Franklin Credit. It trades about 0.14 of its potential returns per unit of risk. Franklin Credit Management is currently generating about -0.11 per unit of risk. If you would invest 2,514 in Logan Ridge Finance on September 1, 2024 and sell it today you would earn a total of 86.00 from holding Logan Ridge Finance or generate 3.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Logan Ridge Finance vs. Franklin Credit Management
Performance |
| Timeline |
| Logan Ridge Finance |
| Franklin Credit Mana |
Logan Ridge and Franklin Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Logan Ridge and Franklin Credit
The main advantage of trading using opposite Logan Ridge and Franklin Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logan Ridge position performs unexpectedly, Franklin Credit 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 Franklin Credit will offset losses from the drop in Franklin Credit's long position.| Logan Ridge vs. Badger Infrastructure Solutions | Logan Ridge vs. Portman Ridge Finance | Logan Ridge vs. Inotiv Inc | Logan Ridge vs. Phenixfin |
| Franklin Credit vs. Global Healthcare REIT | Franklin Credit vs. Freedom Bank of | Franklin Credit vs. Hinto Energy | Franklin Credit vs. Ensurge |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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