Correlation Between Klegg Electronics and LATAM Airlines

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Can any of the company-specific risk be diversified away by investing in both Klegg Electronics and LATAM Airlines 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 Klegg Electronics and LATAM Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Klegg Electronics and LATAM Airlines Group, you can compare the effects of market volatilities on Klegg Electronics and LATAM Airlines 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 Klegg Electronics with a short position of LATAM Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Klegg Electronics and LATAM Airlines.

Diversification Opportunities for Klegg Electronics and LATAM Airlines

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Klegg and LATAM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Klegg Electronics and LATAM Airlines Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LATAM Airlines Group and Klegg Electronics 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 Klegg Electronics are associated (or correlated) with LATAM Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LATAM Airlines Group has no effect on the direction of Klegg Electronics i.e., Klegg Electronics and LATAM Airlines go up and down completely randomly.

Pair Corralation between Klegg Electronics and LATAM Airlines

If you would invest  0.01  in Klegg Electronics on August 30, 2025 and sell it today you would earn a total of  0.00  from holding Klegg Electronics or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy98.44%
ValuesDaily Returns

Klegg Electronics  vs.  LATAM Airlines Group

 Performance 
       Timeline  
Klegg Electronics 

Risk-Adjusted Performance

Weakest

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

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days LATAM Airlines Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, LATAM Airlines is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Klegg Electronics and LATAM Airlines Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Klegg Electronics and LATAM Airlines

The main advantage of trading using opposite Klegg Electronics and LATAM Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Klegg Electronics position performs unexpectedly, LATAM Airlines 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 LATAM Airlines will offset losses from the drop in LATAM Airlines' long position.
The idea behind Klegg Electronics and LATAM Airlines Group 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.

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