Correlation Between Radiant Logistics and Baltic International

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

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

Diversification Opportunities for Radiant Logistics and Baltic International

-0.31

Correlation Coefficient

Radiant Logistics  Baltic International

Very good diversification

The 3 months correlation between Radiant and Baltic is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Radiant Logistics and Baltic International USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baltic International USA and Radiant Logistics 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 Radiant Logistics are associated (or correlated) with Baltic International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baltic International USA has no effect on the direction of Radiant Logistics i.e., Radiant Logistics and Baltic International go up and down completely randomly.

Pair Corralation between Radiant Logistics and Baltic International

If you would invest  606.00  in Radiant Logistics on August 31, 2024 and sell it today you would earn a total of  134.00  from holding Radiant Logistics or generate 22.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Radiant Logistics  vs.  Baltic International USA

Radiant Logistics

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Radiant Logistics are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady technical and fundamental indicators, Radiant Logistics unveiled solid returns over the last few months and may actually be approaching a breakup point.

Baltic International USA

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Radiant Logistics and Baltic International

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

The idea behind Radiant Logistics and Baltic International USA 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.