Correlation Between LOG Commercial and Medtronic Plc

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

By analyzing existing cross correlation between LOG Commercial Properties and Medtronic plc, you can compare the effects of market volatilities on LOG Commercial and Medtronic Plc 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 LOG Commercial with a short position of Medtronic Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of LOG Commercial and Medtronic Plc.

Diversification Opportunities for LOG Commercial and Medtronic Plc

-0.48

Correlation Coefficient

LOG Commercial  Medtronic Plc

Very good diversification

The 3 months correlation between LOG and Medtronic is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding LOG Commercial Properties and Medtronic plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medtronic plc and LOG Commercial 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 LOG Commercial Properties are associated (or correlated) with Medtronic Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medtronic plc has no effect on the direction of LOG Commercial i.e., LOG Commercial and Medtronic Plc go up and down completely randomly.

Pair Corralation between LOG Commercial and Medtronic Plc

Assuming the 90 days trading horizon LOG Commercial is expected to generate 3.96 times less return on investment than Medtronic Plc. In addition to that, LOG Commercial is 1.23 times more volatile than Medtronic plc. It trades about 0.01 of its total potential returns per unit of risk. Medtronic plc is currently generating about 0.04 per unit of volatility. If you would invest  24,366  in Medtronic plc on April 24, 2025 and sell it today you would earn a total of  684.00  from holding Medtronic plc or generate 2.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

LOG Commercial Properties  vs.  Medtronic plc

LOG Commercial Properties

Risk-Adjusted Performance

Very Weak

Over the last 90 days LOG Commercial Properties has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, LOG Commercial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Medtronic plc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Medtronic plc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Medtronic Plc is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with LOG Commercial and Medtronic Plc

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

The idea behind LOG Commercial Properties and Medtronic plc 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.