Correlation Between SHP ETF and SCOR PK
Can any of the company-specific risk be diversified away by investing in both SHP ETF and SCOR PK 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 SHP ETF and SCOR PK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SHP ETF Trust and SCOR PK, you can compare the effects of market volatilities on SHP ETF and SCOR PK 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 SHP ETF with a short position of SCOR PK. Check out your portfolio center. Please also check ongoing floating volatility patterns of SHP ETF and SCOR PK.
Diversification Opportunities for SHP ETF and SCOR PK
Poor diversification
The 3 months correlation between SHP and SCOR is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding SHP ETF Trust and SCOR PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOR PK and SHP ETF 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 SHP ETF Trust are associated (or correlated) with SCOR PK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCOR PK has no effect on the direction of SHP ETF i.e., SHP ETF and SCOR PK go up and down completely randomly.
Pair Corralation between SHP ETF and SCOR PK
Given the investment horizon of 90 days SHP ETF is expected to generate 4.24 times less return on investment than SCOR PK. But when comparing it to its historical volatility, SHP ETF Trust is 47.01 times less risky than SCOR PK. It trades about 0.36 of its potential returns per unit of risk. SCOR PK is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 192.00 in SCOR PK on September 5, 2024 and sell it today you would earn a total of 56.00 from holding SCOR PK or generate 29.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.19% |
| Values | Daily Returns |
SHP ETF Trust vs. SCOR PK
Performance |
| Timeline |
| SHP ETF Trust |
| SCOR PK |
SHP ETF and SCOR PK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SHP ETF and SCOR PK
The main advantage of trading using opposite SHP ETF and SCOR PK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SHP ETF position performs unexpectedly, SCOR PK 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 SCOR PK will offset losses from the drop in SCOR PK's long position.| SHP ETF vs. SCOR PK | SHP ETF vs. HUMANA INC | SHP ETF vs. Aquagold International | SHP ETF vs. Barloworld Ltd ADR |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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