Correlation Between 21Shares Polkadot and Logitech International

Can any of the company-specific risk be diversified away by investing in both 21Shares Polkadot 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 21Shares Polkadot and Logitech International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 21Shares Polkadot ETP and Logitech International SA, you can compare the effects of market volatilities on 21Shares Polkadot 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 21Shares Polkadot with a short position of Logitech International. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Polkadot and Logitech International.

Diversification Opportunities for 21Shares Polkadot and Logitech International

-0.84

Correlation Coefficient

21Shares Polkadot  Logitech International

Pay attention - limited upside

The 3 months correlation between 21Shares and Logitech is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Polkadot ETP and Logitech International SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logitech International and 21Shares Polkadot 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 21Shares Polkadot ETP 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 21Shares Polkadot i.e., 21Shares Polkadot and Logitech International go up and down completely randomly.

Pair Corralation between 21Shares Polkadot and Logitech International

Assuming the 90 days trading horizon 21Shares Polkadot ETP is expected to under-perform the Logitech International. In addition to that, 21Shares Polkadot is 4.29 times more volatile than Logitech International SA. It trades about -0.15 of its total potential returns per unit of risk. Logitech International SA is currently generating about 0.2 per unit of volatility. If you would invest  7,404  in Logitech International SA on December 4, 2024 and sell it today you would earn a total of  1,542  from holding Logitech International SA or generate 20.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.31%
Values	Daily Returns

21Shares Polkadot ETP  vs.  Logitech International SA

21Shares Polkadot ETP

Risk-Adjusted Performance

Very Weak

Over the last 90 days 21Shares Polkadot ETP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Etf's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the fund sophisticated investors.

Logitech International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Logitech International SA are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Logitech International showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with 21Shares Polkadot and Logitech International

The main advantage of trading using opposite 21Shares Polkadot and Logitech International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Polkadot 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 21Shares Polkadot ETP 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.

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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..