Correlation Between Mount Logan and Blackhawk Growth

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

By analyzing existing cross correlation between Mount Logan Capital and Blackhawk Growth Corp, you can compare the effects of market volatilities on Mount Logan and Blackhawk Growth 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 Mount Logan with a short position of Blackhawk Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mount Logan and Blackhawk Growth.

Diversification Opportunities for Mount Logan and Blackhawk Growth

0.59

Correlation Coefficient

Mount Logan  Blackhawk Growth

Very weak diversification

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

Pair Corralation between Mount Logan and Blackhawk Growth

Assuming the 90 days horizon Mount Logan Capital is expected to generate 0.06 times more return on investment than Blackhawk Growth. However, Mount Logan Capital is 16.71 times less risky than Blackhawk Growth. It trades about -0.13 of its potential returns per unit of risk. Blackhawk Growth Corp is currently generating about -0.13 per unit of risk. If you would invest  157.00  in Mount Logan Capital on August 30, 2024 and sell it today you would lose (8.00) from holding Mount Logan Capital or give up 5.1% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	93.65%
Values	Daily Returns

Mount Logan Capital  vs.  Blackhawk Growth Corp

Mount Logan Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mount Logan Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Mount Logan is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Blackhawk Growth Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackhawk Growth Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Mount Logan and Blackhawk Growth

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

The idea behind Mount Logan Capital and Blackhawk Growth Corp 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.