Correlation Between Alstria Office and SCANSOURCE
Can any of the company-specific risk be diversified away by investing in both Alstria Office and SCANSOURCE 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 Alstria Office and SCANSOURCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alstria office REIT AG and SCANSOURCE, you can compare the effects of market volatilities on Alstria Office and SCANSOURCE 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 Alstria Office with a short position of SCANSOURCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and SCANSOURCE.
Diversification Opportunities for Alstria Office and SCANSOURCE
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alstria and SCANSOURCE is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and SCANSOURCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCANSOURCE and Alstria Office 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 alstria office REIT AG are associated (or correlated) with SCANSOURCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCANSOURCE has no effect on the direction of Alstria Office i.e., Alstria Office and SCANSOURCE go up and down completely randomly.
Pair Corralation between Alstria Office and SCANSOURCE
Assuming the 90 days horizon alstria office REIT AG is expected to generate 1.59 times more return on investment than SCANSOURCE. However, Alstria Office is 1.59 times more volatile than SCANSOURCE. It trades about 0.17 of its potential returns per unit of risk. SCANSOURCE is currently generating about 0.06 per unit of risk. If you would invest 341.00 in alstria office REIT AG on September 19, 2024 and sell it today you would earn a total of 423.00 from holding alstria office REIT AG or generate 124.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
alstria office REIT AG vs. SCANSOURCE
Performance |
| Timeline |
| alstria office REIT |
| SCANSOURCE |
Alstria Office and SCANSOURCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and SCANSOURCE
The main advantage of trading using opposite Alstria Office and SCANSOURCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, SCANSOURCE 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 SCANSOURCE will offset losses from the drop in SCANSOURCE's long position.| Alstria Office vs. ORIX JREIT INC | Alstria Office vs. Superior Plus Corp | Alstria Office vs. SIVERS SEMICONDUCTORS AB | Alstria Office vs. Norsk Hydro ASA |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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