Correlation Between Legacy Education and Optex Systems

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

By analyzing existing cross correlation between Legacy Education Alliance and Optex Systems Holdings,, you can compare the effects of market volatilities on Legacy Education and Optex Systems 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 Legacy Education with a short position of Optex Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legacy Education and Optex Systems.

Diversification Opportunities for Legacy Education and Optex Systems

0.0

Correlation Coefficient

Legacy Education  Optex Systems

Pay attention - limited upside

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

Pair Corralation between Legacy Education and Optex Systems

If you would invest  685.00  in Optex Systems Holdings, on May 11, 2025 and sell it today you would earn a total of  683.00  from holding Optex Systems Holdings, or generate 99.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.88%
Values	Daily Returns

Legacy Education Alliance  vs.  Optex Systems Holdings,

Legacy Education Alliance

Risk-Adjusted Performance

Weakest

Over the last 90 days Legacy Education Alliance has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Legacy Education is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Optex Systems Holdings,

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Optex Systems Holdings, are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Optex Systems unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Legacy Education and Optex Systems

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

The idea behind Legacy Education Alliance and Optex Systems Holdings, 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.