Correlation Between SCOR PK and Alger Growth
Can any of the company-specific risk be diversified away by investing in both SCOR PK and Alger Growth 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 SCOR PK and Alger Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCOR PK and Alger Growth Income, you can compare the effects of market volatilities on SCOR PK and Alger Growth 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 SCOR PK with a short position of Alger Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCOR PK and Alger Growth.
Diversification Opportunities for SCOR PK and Alger Growth
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SCOR and Alger is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding SCOR PK and Alger Growth Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Growth Income and SCOR PK 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 SCOR PK are associated (or correlated) with Alger Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Growth Income has no effect on the direction of SCOR PK i.e., SCOR PK and Alger Growth go up and down completely randomly.
Pair Corralation between SCOR PK and Alger Growth
Assuming the 90 days horizon SCOR PK is expected to generate 3.8 times more return on investment than Alger Growth. However, SCOR PK is 3.8 times more volatile than Alger Growth Income. It trades about 0.04 of its potential returns per unit of risk. Alger Growth Income is currently generating about 0.1 per unit of risk. If you would invest 182.00 in SCOR PK on August 24, 2024 and sell it today you would earn a total of 72.00 from holding SCOR PK or generate 39.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.4% |
| Values | Daily Returns |
SCOR PK vs. Alger Growth Income
Performance |
| Timeline |
| SCOR PK |
| Alger Growth Income |
SCOR PK and Alger Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCOR PK and Alger Growth
The main advantage of trading using opposite SCOR PK and Alger Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCOR PK position performs unexpectedly, Alger Growth 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 Alger Growth will offset losses from the drop in Alger Growth's long position.The idea behind SCOR PK and Alger Growth Income 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.| Alger Growth vs. Nuveen Large Cap | Alger Growth vs. Nuveen Large Cap | Alger Growth vs. HUMANA INC | Alger Growth vs. SCOR PK |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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