Correlation Between Zedge and Logility
Can any of the company-specific risk be diversified away by investing in both Zedge and Logility 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 Zedge and Logility into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zedge Inc and Logility, you can compare the effects of market volatilities on Zedge and Logility 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 Zedge with a short position of Logility. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zedge and Logility.
Diversification Opportunities for Zedge and Logility
Very good diversification
The 3 months correlation between Zedge and Logility is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Zedge Inc and Logility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logility and Zedge 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 Zedge Inc are associated (or correlated) with Logility. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logility has no effect on the direction of Zedge i.e., Zedge and Logility go up and down completely randomly.
Pair Corralation between Zedge and Logility
Given the investment horizon of 90 days Zedge Inc is expected to under-perform the Logility. In addition to that, Zedge is 1.52 times more volatile than Logility. It trades about -0.08 of its total potential returns per unit of risk. Logility is currently generating about -0.01 per unit of volatility. If you would invest 1,099 in Logility on September 4, 2024 and sell it today you would lose (34.00) from holding Logility or give up 3.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zedge Inc vs. Logility
Performance |
| Timeline |
| Zedge Inc |
| Logility |
Zedge and Logility Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zedge and Logility
The main advantage of trading using opposite Zedge and Logility positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zedge position performs unexpectedly, Logility 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 Logility will offset losses from the drop in Logility's long position.The idea behind Zedge Inc and Logility 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.| Logility vs. Sun Life Financial | Logility vs. Zedge Inc | Logility vs. SEI Investments | Logility vs. Zhihu Inc ADR |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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