Correlation Between Alten SA and Logic Instrume

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

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

Diversification Opportunities for Alten SA and Logic Instrume

0.3

Correlation Coefficient

Alten SA  Logic Instrume

Weak diversification

The 3 months correlation between Alten and Logic is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Alten SA and Logic Instrume in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logic Instrume and Alten SA 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 Alten SA are associated (or correlated) with Logic Instrume. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logic Instrume has no effect on the direction of Alten SA i.e., Alten SA and Logic Instrume go up and down completely randomly.

Pair Corralation between Alten SA and Logic Instrume

Assuming the 90 days trading horizon Alten SA is expected to under-perform the Logic Instrume. But the stock apears to be less risky and, when comparing its historical volatility, Alten SA is 1.52 times less risky than Logic Instrume. The stock trades about -0.03 of its potential returns per unit of risk. The Logic Instrume is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  145.00  in Logic Instrume on April 24, 2025 and sell it today you would earn a total of  49.00  from holding Logic Instrume or generate 33.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Alten SA  vs.  Logic Instrume

Alten SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alten SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Alten SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Logic Instrume

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Logic Instrume are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Logic Instrume reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alten SA and Logic Instrume

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

The idea behind Alten SA and Logic Instrume 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.