Correlation Between Sensorion and Logic Instrume

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Can any of the company-specific risk be diversified away by investing in both Sensorion and Logic Instrume 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 Sensorion and Logic Instrume into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sensorion SA and Logic Instrume, you can compare the effects of market volatilities on Sensorion and Logic Instrume 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 Sensorion with a short position of Logic Instrume. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensorion and Logic Instrume.

Diversification Opportunities for Sensorion and Logic Instrume

0.43
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Sensorion and Logic is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Sensorion SA and Logic Instrume in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logic Instrume and Sensorion 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 Sensorion SA are associated (or correlated) with Logic Instrume. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logic Instrume has no effect on the direction of Sensorion i.e., Sensorion and Logic Instrume go up and down completely randomly.

Pair Corralation between Sensorion and Logic Instrume

Assuming the 90 days trading horizon Sensorion SA is expected to generate 1.3 times more return on investment than Logic Instrume. However, Sensorion is 1.3 times more volatile than Logic Instrume. It trades about 0.02 of its potential returns per unit of risk. Logic Instrume is currently generating about -0.05 per unit of risk. If you would invest  69.00  in Sensorion SA on September 3, 2024 and sell it today you would earn a total of  0.00  from holding Sensorion SA or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Sensorion SA  vs.  Logic Instrume

 Performance 
       Timeline  
Sensorion SA 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Sensorion SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Sensorion is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.
Logic Instrume 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Logic Instrume has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Sensorion and Logic Instrume Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Sensorion and Logic Instrume

The main advantage of trading using opposite Sensorion and Logic Instrume positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensorion position performs unexpectedly, Logic Instrume 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 Logic Instrume will offset losses from the drop in Logic Instrume's long position.
The idea behind Sensorion SA and Logic Instrume 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.

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