Correlation Between Summit Bank and Contextlogic

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

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

Diversification Opportunities for Summit Bank and Contextlogic

0.34

Correlation Coefficient

Summit Bank  Contextlogic

Weak diversification

The 3 months correlation between Summit and Contextlogic is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Summit Bank Group and Contextlogic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contextlogic and Summit Bank 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 Summit Bank Group are associated (or correlated) with Contextlogic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contextlogic has no effect on the direction of Summit Bank i.e., Summit Bank and Contextlogic go up and down completely randomly.

Pair Corralation between Summit Bank and Contextlogic

Given the investment horizon of 90 days Summit Bank Group is expected to generate 0.12 times more return on investment than Contextlogic. However, Summit Bank Group is 8.52 times less risky than Contextlogic. It trades about 0.27 of its potential returns per unit of risk. Contextlogic is currently generating about -0.08 per unit of risk. If you would invest  1,400  in Summit Bank Group on May 28, 2025 and sell it today you would earn a total of  148.00  from holding Summit Bank Group or generate 10.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	29.03%
Values	Daily Returns

Summit Bank Group  vs.  Contextlogic

Summit Bank Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Summit Bank Group are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward-looking signals, Summit Bank may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Contextlogic

Risk-Adjusted Performance

Weakest

Over the last 90 days Contextlogic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in September 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Summit Bank and Contextlogic

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

The idea behind Summit Bank Group and Contextlogic 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.