Correlation Between ScanSource and Intesa Sanpaolo
Can any of the company-specific risk be diversified away by investing in both ScanSource and Intesa Sanpaolo 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 Intesa Sanpaolo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ScanSource and Intesa Sanpaolo SpA, you can compare the effects of market volatilities on ScanSource and Intesa Sanpaolo 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 Intesa Sanpaolo. Check out your portfolio center. Please also check ongoing floating volatility patterns of ScanSource and Intesa Sanpaolo.
Diversification Opportunities for ScanSource and Intesa Sanpaolo
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between ScanSource and Intesa is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding ScanSource and Intesa Sanpaolo SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intesa Sanpaolo SpA 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 Intesa Sanpaolo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intesa Sanpaolo SpA has no effect on the direction of ScanSource i.e., ScanSource and Intesa Sanpaolo go up and down completely randomly.
Pair Corralation between ScanSource and Intesa Sanpaolo
Assuming the 90 days horizon ScanSource is expected to generate 13.01 times less return on investment than Intesa Sanpaolo. In addition to that, ScanSource is 1.43 times more volatile than Intesa Sanpaolo SpA. It trades about 0.01 of its total potential returns per unit of risk. Intesa Sanpaolo SpA is currently generating about 0.17 per unit of volatility. If you would invest 366.00 in Intesa Sanpaolo SpA on September 13, 2024 and sell it today you would earn a total of 19.00 from holding Intesa Sanpaolo SpA or generate 5.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ScanSource vs. Intesa Sanpaolo SpA
Performance |
| Timeline |
| ScanSource |
| Intesa Sanpaolo SpA |
ScanSource and Intesa Sanpaolo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ScanSource and Intesa Sanpaolo
The main advantage of trading using opposite ScanSource and Intesa Sanpaolo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ScanSource position performs unexpectedly, Intesa Sanpaolo 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 Intesa Sanpaolo will offset losses from the drop in Intesa Sanpaolo's long position.The idea behind ScanSource and Intesa Sanpaolo SpA 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.| Intesa Sanpaolo vs. Tsingtao Brewery | Intesa Sanpaolo vs. ScanSource | Intesa Sanpaolo vs. Thai Beverage Public | Intesa Sanpaolo vs. Vishay Intertechnology |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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