Correlation Between Extreme Networks and Logitech International
Can any of the company-specific risk be diversified away by investing in both Extreme Networks and Logitech 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 Extreme Networks and Logitech International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Extreme Networks and Logitech International SA, you can compare the effects of market volatilities on Extreme Networks and Logitech 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 Extreme Networks with a short position of Logitech International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Extreme Networks and Logitech International.
Diversification Opportunities for Extreme Networks and Logitech International
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Extreme and Logitech is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Extreme Networks and Logitech International SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logitech International and Extreme Networks 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 Extreme Networks are associated (or correlated) with Logitech International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logitech International has no effect on the direction of Extreme Networks i.e., Extreme Networks and Logitech International go up and down completely randomly.
Pair Corralation between Extreme Networks and Logitech International
Given the investment horizon of 90 days Extreme Networks is expected to generate 0.99 times more return on investment than Logitech International. However, Extreme Networks is 1.01 times less risky than Logitech International. It trades about 0.16 of its potential returns per unit of risk. Logitech International SA is currently generating about 0.05 per unit of risk. If you would invest 1,323 in Extreme Networks on March 30, 2025 and sell it today you would earn a total of 454.00 from holding Extreme Networks or generate 34.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Extreme Networks vs. Logitech International SA
Performance |
| Timeline |
| Extreme Networks |
| Logitech International |
Extreme Networks and Logitech International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Extreme Networks and Logitech International
The main advantage of trading using opposite Extreme Networks and Logitech International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Extreme Networks position performs unexpectedly, Logitech 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 Logitech International will offset losses from the drop in Logitech International's long position.| Extreme Networks vs. Knowles Cor | Extreme Networks vs. KVH Industries | Extreme Networks vs. Comtech Telecommunications Corp | Extreme Networks vs. EchoStar |
| Logitech International vs. Pure Storage | Logitech International vs. Seagate Technology PLC | Logitech International vs. HP Inc | Logitech International vs. Dell Technologies |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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