Correlation Between Logan Ridge and Manaris Corp

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

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

Diversification Opportunities for Logan Ridge and Manaris Corp

0.0

Correlation Coefficient

Logan Ridge  Manaris Corp

Pay attention - limited upside

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

Pair Corralation between Logan Ridge and Manaris Corp

Given the investment horizon of 90 days Logan Ridge is expected to generate 32.18 times less return on investment than Manaris Corp. But when comparing it to its historical volatility, Logan Ridge Finance is 39.47 times less risky than Manaris Corp. It trades about 0.05 of its potential returns per unit of risk. Manaris Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  0.01  in Manaris Corp on September 3, 2024 and sell it today you would earn a total of  0.00  from holding Manaris Corp or generate 0.0% return on investment over 90 days.

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

Logan Ridge Finance  vs.  Manaris Corp

Logan Ridge Finance

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Logan Ridge Finance are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical and fundamental indicators, Logan Ridge exhibited solid returns over the last few months and may actually be approaching a breakup point.

Manaris Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Manaris Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Manaris Corp is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Logan Ridge and Manaris Corp

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

The idea behind Logan Ridge Finance and Manaris Corp 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.