Correlation Between Keck Seng and ScanSource
Can any of the company-specific risk be diversified away by investing in both Keck Seng 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 Keck Seng and ScanSource into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keck Seng Investments and ScanSource, you can compare the effects of market volatilities on Keck Seng 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 Keck Seng with a short position of ScanSource. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keck Seng and ScanSource.
Diversification Opportunities for Keck Seng and ScanSource
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Keck and ScanSource is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Keck Seng Investments and ScanSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScanSource and Keck Seng 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 Keck Seng Investments 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 Keck Seng i.e., Keck Seng and ScanSource go up and down completely randomly.
Pair Corralation between Keck Seng and ScanSource
Assuming the 90 days horizon Keck Seng Investments is expected to generate 2.57 times more return on investment than ScanSource. However, Keck Seng is 2.57 times more volatile than ScanSource. It trades about 0.08 of its potential returns per unit of risk. ScanSource is currently generating about 0.07 per unit of risk. If you would invest 19.00 in Keck Seng Investments on October 18, 2024 and sell it today you would earn a total of 5.00 from holding Keck Seng Investments or generate 26.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keck Seng Investments vs. ScanSource
Performance |
| Timeline |
| Keck Seng Investments |
| ScanSource |
Keck Seng and ScanSource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keck Seng and ScanSource
The main advantage of trading using opposite Keck Seng and ScanSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keck Seng 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.| Keck Seng vs. Marriott International | Keck Seng vs. Hilton Worldwide Holdings | Keck Seng vs. H World Group | Keck Seng vs. Hyatt Hotels |
| ScanSource vs. Keck Seng Investments | ScanSource vs. BW OFFSHORE LTD | ScanSource vs. Casio Computer CoLtd | ScanSource vs. SIEM OFFSHORE NEW |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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