Correlation Between SCOR SE and Charter Communications
Can any of the company-specific risk be diversified away by investing in both SCOR SE and Charter Communications 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 SE and Charter Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCOR SE and Charter Communications, you can compare the effects of market volatilities on SCOR SE and Charter Communications 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 SE with a short position of Charter Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCOR SE and Charter Communications.
Diversification Opportunities for SCOR SE and Charter Communications
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SCOR and Charter is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding SCOR SE and Charter Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charter Communications and SCOR SE 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 SE are associated (or correlated) with Charter Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charter Communications has no effect on the direction of SCOR SE i.e., SCOR SE and Charter Communications go up and down completely randomly.
Pair Corralation between SCOR SE and Charter Communications
Assuming the 90 days trading horizon SCOR SE is expected to generate 0.68 times more return on investment than Charter Communications. However, SCOR SE is 1.47 times less risky than Charter Communications. It trades about 0.09 of its potential returns per unit of risk. Charter Communications is currently generating about -0.08 per unit of risk. If you would invest 2,440 in SCOR SE on October 11, 2024 and sell it today you would earn a total of 46.00 from holding SCOR SE or generate 1.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
SCOR SE vs. Charter Communications
Performance |
| Timeline |
| SCOR SE |
| Charter Communications |
SCOR SE and Charter Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCOR SE and Charter Communications
The main advantage of trading using opposite SCOR SE and Charter Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCOR SE position performs unexpectedly, Charter Communications 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 Charter Communications will offset losses from the drop in Charter Communications' long position.| SCOR SE vs. alstria office REIT AG | SCOR SE vs. KENEDIX OFFICE INV | SCOR SE vs. Charter Communications | SCOR SE vs. MAVEN WIRELESS SWEDEN |
| Charter Communications vs. UPDATE SOFTWARE | Charter Communications vs. AXWAY SOFTWARE EO | Charter Communications vs. CPU SOFTWAREHOUSE | Charter Communications vs. VITEC SOFTWARE GROUP |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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