Correlation Between Logan Circle and Logan Capital

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

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

Diversification Opportunities for Logan Circle and Logan Capital

0.0

Correlation Coefficient

Logan Circle  Logan Capital

Pay attention - limited upside

The 3 months correlation between Logan and Logan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Logan Circle Partners and Logan Capital Longshort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logan Capital Longshort and Logan Circle 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 Logan Circle Partners are associated (or correlated) with Logan Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logan Capital Longshort has no effect on the direction of Logan Circle i.e., Logan Circle and Logan Capital go up and down completely randomly.

Pair Corralation between Logan Circle and Logan Capital

If you would invest  848.00  in Logan Circle Partners on December 20, 2024 and sell it today you would earn a total of  22.00  from holding Logan Circle Partners or generate 2.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Logan Circle Partners  vs.  Logan Capital Longshort

Logan Circle Partners

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Logan Circle Partners are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Logan Circle is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Logan Capital Longshort

Risk-Adjusted Performance

Very Weak

Over the last 90 days Logan Capital Longshort has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong primary indicators, Logan Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Logan Circle and Logan Capital

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

The idea behind Logan Circle Partners and Logan Capital Longshort 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.