Correlation Between SCOR PK and Federated International
Can any of the company-specific risk be diversified away by investing in both SCOR PK and Federated International 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 Federated International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCOR PK and Federated International Leaders, you can compare the effects of market volatilities on SCOR PK and Federated International 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 Federated International. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCOR PK and Federated International.
Diversification Opportunities for SCOR PK and Federated International
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SCOR and Federated is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding SCOR PK and Federated International Leader in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated International 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 Federated International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated International has no effect on the direction of SCOR PK i.e., SCOR PK and Federated International go up and down completely randomly.
Pair Corralation between SCOR PK and Federated International
Assuming the 90 days horizon SCOR PK is expected to under-perform the Federated International. In addition to that, SCOR PK is 3.63 times more volatile than Federated International Leaders. It trades about 0.0 of its total potential returns per unit of risk. Federated International Leaders is currently generating about 0.0 per unit of volatility. If you would invest 3,617 in Federated International Leaders on October 22, 2024 and sell it today you would lose (36.00) from holding Federated International Leaders or give up 1.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.12% |
| Values | Daily Returns |
SCOR PK vs. Federated International Leader
Performance |
| Timeline |
| SCOR PK |
| Federated International |
SCOR PK and Federated International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCOR PK and Federated International
The main advantage of trading using opposite SCOR PK and Federated International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCOR PK position performs unexpectedly, Federated International 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 Federated International will offset losses from the drop in Federated International's long position.The idea behind SCOR PK and Federated International Leaders 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.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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |