Correlation Between ScanSource and Cass Information
Can any of the company-specific risk be diversified away by investing in both ScanSource and Cass Information 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 ScanSource and Cass Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ScanSource and Cass Information Systems, you can compare the effects of market volatilities on ScanSource and Cass Information 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 ScanSource with a short position of Cass Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of ScanSource and Cass Information.
Diversification Opportunities for ScanSource and Cass Information
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ScanSource and Cass is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding ScanSource and Cass Information Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cass Information Systems and ScanSource 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 ScanSource are associated (or correlated) with Cass Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cass Information Systems has no effect on the direction of ScanSource i.e., ScanSource and Cass Information go up and down completely randomly.
Pair Corralation between ScanSource and Cass Information
Assuming the 90 days horizon ScanSource is expected to generate 0.71 times more return on investment than Cass Information. However, ScanSource is 1.41 times less risky than Cass Information. It trades about 0.17 of its potential returns per unit of risk. Cass Information Systems is currently generating about -0.08 per unit of risk. If you would invest 4,640 in ScanSource on October 25, 2024 and sell it today you would earn a total of 180.00 from holding ScanSource or generate 3.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ScanSource vs. Cass Information Systems
Performance |
| Timeline |
| ScanSource |
| Cass Information Systems |
ScanSource and Cass Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ScanSource and Cass Information
The main advantage of trading using opposite ScanSource and Cass Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ScanSource position performs unexpectedly, Cass Information 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 Cass Information will offset losses from the drop in Cass Information's long position.| ScanSource vs. GameStop Corp | ScanSource vs. Infrastrutture Wireless Italiane | ScanSource vs. OURGAME INTHOLDL 00005 | ScanSource vs. GigaMedia |
| Cass Information vs. INPOST SA EO | Cass Information vs. Elis SA | Cass Information vs. PARK24 LTD | Cass Information vs. RELO GROUP INC |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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