Correlation Between DXC Technology and LGL

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

By analyzing existing cross correlation between DXC Technology Co and LGL Group, you can compare the effects of market volatilities on DXC Technology and LGL 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 DXC Technology with a short position of LGL. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and LGL.

Diversification Opportunities for DXC Technology and LGL

-0.39

Correlation Coefficient

DXC Technology  LGL

Very good diversification

The 3 months correlation between DXC and LGL is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and LGL Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LGL Group and DXC Technology 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 DXC Technology Co are associated (or correlated) with LGL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LGL Group has no effect on the direction of DXC Technology i.e., DXC Technology and LGL go up and down completely randomly.

Pair Corralation between DXC Technology and LGL

Considering the 90-day investment horizon DXC Technology Co is expected to under-perform the LGL. In addition to that, DXC Technology is 1.01 times more volatile than LGL Group. It trades about -0.06 of its total potential returns per unit of risk. LGL Group is currently generating about 0.03 per unit of volatility. If you would invest  680.00  in LGL Group on May 18, 2025 and sell it today you would earn a total of  15.00  from holding LGL Group or generate 2.21% return on investment over 90 days.

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

DXC Technology Co  vs.  LGL Group

DXC Technology

Risk-Adjusted Performance

Weakest

Over the last 90 days DXC Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

LGL Group

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in LGL Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent technical and fundamental indicators, LGL is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with DXC Technology and LGL

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

The idea behind DXC Technology Co and LGL 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.