Correlation Between SCANSOURCE (SC3SG) and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both SCANSOURCE (SC3SG) and AEGEAN AIRLINES 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 (SC3SG) and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCANSOURCE and AEGEAN AIRLINES, you can compare the effects of market volatilities on SCANSOURCE (SC3SG) and AEGEAN AIRLINES 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 (SC3SG) with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANSOURCE (SC3SG) and AEGEAN AIRLINES.
Diversification Opportunities for SCANSOURCE (SC3SG) and AEGEAN AIRLINES
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SCANSOURCE and AEGEAN is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding SCANSOURCE and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and SCANSOURCE (SC3SG) 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 AEGEAN AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEGEAN AIRLINES has no effect on the direction of SCANSOURCE (SC3SG) i.e., SCANSOURCE (SC3SG) and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between SCANSOURCE (SC3SG) and AEGEAN AIRLINES
Assuming the 90 days trading horizon SCANSOURCE is expected to generate 1.13 times more return on investment than AEGEAN AIRLINES. However, SCANSOURCE (SC3SG) is 1.13 times more volatile than AEGEAN AIRLINES. It trades about 0.07 of its potential returns per unit of risk. AEGEAN AIRLINES is currently generating about 0.01 per unit of risk. If you would invest 2,840 in SCANSOURCE on September 2, 2024 and sell it today you would earn a total of 1,900 from holding SCANSOURCE or generate 66.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCANSOURCE vs. AEGEAN AIRLINES
Performance |
| Timeline |
| SCANSOURCE (SC3SG) |
| AEGEAN AIRLINES |
SCANSOURCE (SC3SG) and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCANSOURCE (SC3SG) and AEGEAN AIRLINES
The main advantage of trading using opposite SCANSOURCE (SC3SG) and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCANSOURCE (SC3SG) position performs unexpectedly, AEGEAN AIRLINES 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 AEGEAN AIRLINES will offset losses from the drop in AEGEAN AIRLINES's long position.| SCANSOURCE (SC3SG) vs. SIVERS SEMICONDUCTORS AB | SCANSOURCE (SC3SG) vs. Darden Restaurants | SCANSOURCE (SC3SG) vs. Reliance Steel Aluminum | SCANSOURCE (SC3SG) vs. Q2M Managementberatung AG |
| AEGEAN AIRLINES vs. Reinsurance Group of | AEGEAN AIRLINES vs. Iridium Communications | AEGEAN AIRLINES vs. Universal Insurance Holdings | AEGEAN AIRLINES vs. Cogent Communications Holdings |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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