Correlation Between LogicMark and Quantum

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

By analyzing existing cross correlation between LogicMark and Quantum, you can compare the effects of market volatilities on LogicMark and Quantum 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 LogicMark with a short position of Quantum. Check out your portfolio center. Please also check ongoing floating volatility patterns of LogicMark and Quantum.

Diversification Opportunities for LogicMark and Quantum

-0.38

Correlation Coefficient

LogicMark  Quantum

Very good diversification

The 3 months correlation between LogicMark and Quantum is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding LogicMark and Quantum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantum and LogicMark 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 LogicMark are associated (or correlated) with Quantum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantum has no effect on the direction of LogicMark i.e., LogicMark and Quantum go up and down completely randomly.

Pair Corralation between LogicMark and Quantum

Given the investment horizon of 90 days LogicMark is expected to under-perform the Quantum. But the stock apears to be less risky and, when comparing its historical volatility, LogicMark is 6.26 times less risky than Quantum. The stock trades about -0.39 of its potential returns per unit of risk. The Quantum is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  298.00  in Quantum on November 19, 2024 and sell it today you would earn a total of  1,419  from holding Quantum or generate 476.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

LogicMark  vs.  Quantum

LogicMark

Risk-Adjusted Performance

Very Weak

Over the last 90 days LogicMark has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's primary indicators remain quite persistent which may send shares a bit higher in March 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Quantum

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Quantum are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Quantum displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with LogicMark and Quantum

The main advantage of trading using opposite LogicMark and Quantum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LogicMark position performs unexpectedly, Quantum 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 Quantum will offset losses from the drop in Quantum's long position.

The idea behind LogicMark and Quantum 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.

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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.