Correlation Between SCI Engineered and Procyon
Can any of the company-specific risk be diversified away by investing in both SCI Engineered and Procyon 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 SCI Engineered and Procyon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCI Engineered Materials and Procyon, you can compare the effects of market volatilities on SCI Engineered and Procyon 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 SCI Engineered with a short position of Procyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCI Engineered and Procyon.
Diversification Opportunities for SCI Engineered and Procyon
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SCI and Procyon is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding SCI Engineered Materials and Procyon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Procyon and SCI Engineered 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 SCI Engineered Materials are associated (or correlated) with Procyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Procyon has no effect on the direction of SCI Engineered i.e., SCI Engineered and Procyon go up and down completely randomly.
Pair Corralation between SCI Engineered and Procyon
Given the investment horizon of 90 days SCI Engineered Materials is expected to generate 2.58 times more return on investment than Procyon. However, SCI Engineered is 2.58 times more volatile than Procyon. It trades about -0.07 of its potential returns per unit of risk. Procyon is currently generating about -0.22 per unit of risk. If you would invest 518.00 in SCI Engineered Materials on November 9, 2024 and sell it today you would lose (26.00) from holding SCI Engineered Materials or give up 5.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCI Engineered Materials vs. Procyon
Performance |
| Timeline |
| SCI Engineered Materials |
| Procyon |
SCI Engineered and Procyon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCI Engineered and Procyon
The main advantage of trading using opposite SCI Engineered and Procyon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCI Engineered position performs unexpectedly, Procyon 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 Procyon will offset losses from the drop in Procyon's long position.| SCI Engineered vs. Surge Components | SCI Engineered vs. Solitron Devices | SCI Engineered vs. Table Trac | SCI Engineered vs. Ieh Corp |
| Procyon vs. Hypera SA | Procyon vs. YourWay Cannabis Brands | Procyon vs. Cumberland Pharmaceuticals | Procyon vs. City View Green |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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