Correlation Between SCANSOURCE and BOSTON BEER
Can any of the company-specific risk be diversified away by investing in both SCANSOURCE and BOSTON BEER 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 BOSTON BEER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCANSOURCE and BOSTON BEER A , you can compare the effects of market volatilities on SCANSOURCE and BOSTON BEER 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 BOSTON BEER. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANSOURCE and BOSTON BEER.
Diversification Opportunities for SCANSOURCE and BOSTON BEER
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SCANSOURCE and BOSTON is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding SCANSOURCE and BOSTON BEER A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOSTON BEER A 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 BOSTON BEER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOSTON BEER A has no effect on the direction of SCANSOURCE i.e., SCANSOURCE and BOSTON BEER go up and down completely randomly.
Pair Corralation between SCANSOURCE and BOSTON BEER
Assuming the 90 days trading horizon SCANSOURCE is expected to generate 1.76 times more return on investment than BOSTON BEER. However, SCANSOURCE is 1.76 times more volatile than BOSTON BEER A . It trades about 0.27 of its potential returns per unit of risk. BOSTON BEER A is currently generating about 0.13 per unit of risk. If you would invest 3,960 in SCANSOURCE on August 30, 2024 and sell it today you would earn a total of 800.00 from holding SCANSOURCE or generate 20.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCANSOURCE vs. BOSTON BEER A
Performance |
| Timeline |
| SCANSOURCE |
| BOSTON BEER A |
SCANSOURCE and BOSTON BEER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCANSOURCE and BOSTON BEER
The main advantage of trading using opposite SCANSOURCE and BOSTON BEER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCANSOURCE position performs unexpectedly, BOSTON BEER 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 BOSTON BEER will offset losses from the drop in BOSTON BEER's long position.| SCANSOURCE vs. Apple Inc | SCANSOURCE vs. Apple Inc | SCANSOURCE vs. Superior Plus Corp | SCANSOURCE vs. SIVERS SEMICONDUCTORS AB |
| BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Apple Inc | BOSTON BEER vs. Superior Plus Corp | BOSTON BEER vs. SIVERS SEMICONDUCTORS AB |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Transaction History View history of all your transactions and understand their impact on performance |