Correlation Between PAR Technology and Logitech International
Can any of the company-specific risk be diversified away by investing in both PAR Technology 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 PAR Technology and Logitech International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PAR Technology and Logitech International SA, you can compare the effects of market volatilities on PAR Technology 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 PAR Technology with a short position of Logitech International. Check out your portfolio center. Please also check ongoing floating volatility patterns of PAR Technology and Logitech International.
Diversification Opportunities for PAR Technology and Logitech International
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PAR and Logitech is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding PAR Technology and Logitech International SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logitech International and PAR 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 PAR Technology 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 PAR Technology i.e., PAR Technology and Logitech International go up and down completely randomly.
Pair Corralation between PAR Technology and Logitech International
Considering the 90-day investment horizon PAR Technology is expected to generate 1.55 times more return on investment than Logitech International. However, PAR Technology is 1.55 times more volatile than Logitech International SA. It trades about 0.41 of its potential returns per unit of risk. Logitech International SA is currently generating about -0.04 per unit of risk. If you would invest 5,986 in PAR Technology on August 28, 2024 and sell it today you would earn a total of 1,847 from holding PAR Technology or generate 30.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PAR Technology vs. Logitech International SA
Performance |
| Timeline |
| PAR Technology |
| Logitech International |
PAR Technology and Logitech International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PAR Technology and Logitech International
The main advantage of trading using opposite PAR Technology and Logitech International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PAR Technology 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.The idea behind PAR Technology and Logitech International SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Logitech International vs. Pure Storage | Logitech International vs. Seagate Technology PLC | Logitech International vs. HP Inc | Logitech International vs. Dell Technologies |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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