Correlation Between Mount Logan and Partners

Can any of the company-specific risk be diversified away by investing in both Mount Logan and Partners 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 Partners 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 Partners Group, you can compare the effects of market volatilities on Mount Logan and Partners 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 Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mount Logan and Partners.

Diversification Opportunities for Mount Logan and Partners

0.03

Correlation Coefficient

Mount Logan  Partners

Significant diversification

The 3 months correlation between Mount and Partners is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Mount Logan Capital and Partners Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Partners Group 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 Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Partners Group has no effect on the direction of Mount Logan i.e., Mount Logan and Partners go up and down completely randomly.

Pair Corralation between Mount Logan and Partners

Assuming the 90 days horizon Mount Logan Capital is expected to generate 0.44 times more return on investment than Partners. However, Mount Logan Capital is 2.25 times less risky than Partners. It trades about 0.22 of its potential returns per unit of risk. Partners Group is currently generating about -0.05 per unit of risk. If you would invest  140.00  in Mount Logan Capital on February 13, 2024 and sell it today you would earn a total of  6.00  from holding Mount Logan Capital or generate 4.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Mount Logan Capital  vs.  Partners Group

Mount Logan Capital

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mount Logan Capital are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Mount Logan reported solid returns over the last few months and may actually be approaching a breakup point.

Partners Group

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Partners Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical indicators, Partners is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Mount Logan and Partners

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

The idea behind Mount Logan Capital and Partners 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.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.