Correlation Between Lantronix and QuickLogic

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

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

Diversification Opportunities for Lantronix and QuickLogic

0.61

Correlation Coefficient

Lantronix  QuickLogic

Poor diversification

The 3 months correlation between Lantronix and QuickLogic is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Lantronix and QuickLogic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QuickLogic and Lantronix 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 Lantronix are associated (or correlated) with QuickLogic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QuickLogic has no effect on the direction of Lantronix i.e., Lantronix and QuickLogic go up and down completely randomly.

Pair Corralation between Lantronix and QuickLogic

Given the investment horizon of 90 days Lantronix is expected to generate 0.86 times more return on investment than QuickLogic. However, Lantronix is 1.16 times less risky than QuickLogic. It trades about 0.17 of its potential returns per unit of risk. QuickLogic is currently generating about 0.05 per unit of risk. If you would invest  213.00  in Lantronix on May 7, 2025 and sell it today you would earn a total of  90.00  from holding Lantronix or generate 42.25% return on investment over 90 days.

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

Lantronix  vs.  QuickLogic

Lantronix

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Lantronix are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Lantronix showed solid returns over the last few months and may actually be approaching a breakup point.

QuickLogic

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in QuickLogic are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain forward indicators, QuickLogic disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lantronix and QuickLogic

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

The idea behind Lantronix and QuickLogic 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.