Correlation Between Maris Tech and LGL

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

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

Diversification Opportunities for Maris Tech and LGL

-0.51

Correlation Coefficient

Maris Tech  LGL

Excellent diversification

The 3 months correlation between Maris and LGL is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Maris Tech and LGL Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LGL Group and Maris Tech 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 Maris Tech are associated (or correlated) with LGL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LGL Group has no effect on the direction of Maris Tech i.e., Maris Tech and LGL go up and down completely randomly.

Pair Corralation between Maris Tech and LGL

Given the investment horizon of 90 days Maris Tech is expected to under-perform the LGL. In addition to that, Maris Tech is 1.89 times more volatile than LGL Group. It trades about -0.11 of its total potential returns per unit of risk. LGL Group is currently generating about 0.06 per unit of volatility. If you would invest  576.00  in LGL Group on December 27, 2024 and sell it today you would earn a total of  56.00  from holding LGL Group or generate 9.72% return on investment over 90 days.

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

Maris Tech  vs.  LGL Group

Maris Tech

Risk-Adjusted Performance

Very Weak

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

LGL Group

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in LGL Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain technical and fundamental indicators, LGL disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Maris Tech and LGL

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

The idea behind Maris Tech and LGL Group 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.