Correlation Between ScanSource and Intel
Can any of the company-specific risk be diversified away by investing in both ScanSource and Intel 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 Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ScanSource and Intel, you can compare the effects of market volatilities on ScanSource and Intel 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 Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of ScanSource and Intel.
Diversification Opportunities for ScanSource and Intel
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ScanSource and Intel is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding ScanSource and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel 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 Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of ScanSource i.e., ScanSource and Intel go up and down completely randomly.
Pair Corralation between ScanSource and Intel
Assuming the 90 days horizon ScanSource is expected to generate 0.64 times more return on investment than Intel. However, ScanSource is 1.57 times less risky than Intel. It trades about 0.06 of its potential returns per unit of risk. Intel is currently generating about -0.28 per unit of risk. If you would invest 4,580 in ScanSource on September 22, 2024 and sell it today you would earn a total of 100.00 from holding ScanSource or generate 2.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ScanSource vs. Intel
Performance |
| Timeline |
| ScanSource |
| Intel |
ScanSource and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ScanSource and Intel
The main advantage of trading using opposite ScanSource and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ScanSource position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| ScanSource vs. MULTI CHEM LTD | ScanSource vs. LEGAL GENERAL | ScanSource vs. SPORTING | ScanSource vs. US FOODS HOLDING |
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 Directory module to find actively traded commodities issued by global exchanges.
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