Correlation Between ScanSource and Oatly Group
Can any of the company-specific risk be diversified away by investing in both ScanSource and Oatly Group 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 Oatly Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ScanSource and Oatly Group AB, you can compare the effects of market volatilities on ScanSource and Oatly Group 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 Oatly Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of ScanSource and Oatly Group.
Diversification Opportunities for ScanSource and Oatly Group
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ScanSource and Oatly is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding ScanSource and Oatly Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oatly Group AB 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 Oatly Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oatly Group AB has no effect on the direction of ScanSource i.e., ScanSource and Oatly Group go up and down completely randomly.
Pair Corralation between ScanSource and Oatly Group
Given the investment horizon of 90 days ScanSource is expected to generate 1.53 times less return on investment than Oatly Group. But when comparing it to its historical volatility, ScanSource is 3.27 times less risky than Oatly Group. It trades about 0.31 of its potential returns per unit of risk. Oatly Group AB is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 63.00 in Oatly Group AB on October 29, 2024 and sell it today you would earn a total of 6.00 from holding Oatly Group AB or generate 9.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ScanSource vs. Oatly Group AB
Performance |
| Timeline |
| ScanSource |
| Oatly Group AB |
ScanSource and Oatly Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ScanSource and Oatly Group
The main advantage of trading using opposite ScanSource and Oatly Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ScanSource position performs unexpectedly, Oatly Group 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 Oatly Group will offset losses from the drop in Oatly Group's long position.| ScanSource vs. Climb Global Solutions | ScanSource vs. Insight Enterprises | ScanSource vs. Synnex | ScanSource vs. PC Connection |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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