Correlation Between Fenix Outdoor and Logistea

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

By analyzing existing cross correlation between Fenix Outdoor International and Logistea AB Series, you can compare the effects of market volatilities on Fenix Outdoor and Logistea 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 Fenix Outdoor with a short position of Logistea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fenix Outdoor and Logistea.

Diversification Opportunities for Fenix Outdoor and Logistea

-0.59

Correlation Coefficient

Fenix Outdoor  Logistea

Excellent diversification

The 3 months correlation between Fenix and Logistea is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Fenix Outdoor International and Logistea AB Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logistea AB Series and Fenix Outdoor 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 Fenix Outdoor International are associated (or correlated) with Logistea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logistea AB Series has no effect on the direction of Fenix Outdoor i.e., Fenix Outdoor and Logistea go up and down completely randomly.

Pair Corralation between Fenix Outdoor and Logistea

Assuming the 90 days trading horizon Fenix Outdoor International is expected to under-perform the Logistea. But the stock apears to be less risky and, when comparing its historical volatility, Fenix Outdoor International is 1.05 times less risky than Logistea. The stock trades about -0.09 of its potential returns per unit of risk. The Logistea AB Series is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  1,435  in Logistea AB Series on April 23, 2025 and sell it today you would earn a total of  241.00  from holding Logistea AB Series or generate 16.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Fenix Outdoor International  vs.  Logistea AB Series

Fenix Outdoor Intern

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fenix Outdoor International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Logistea AB Series

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Logistea AB Series are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Logistea sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fenix Outdoor and Logistea

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

The idea behind Fenix Outdoor International and Logistea AB Series 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.