Correlation Between Causeway International and Scout E

Can any of the company-specific risk be diversified away by investing in both Causeway International and Scout E 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 Causeway International and Scout E into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Causeway International Value and Scout E Plus, you can compare the effects of market volatilities on Causeway International and Scout E 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 Causeway International with a short position of Scout E. Check out your portfolio center. Please also check ongoing floating volatility patterns of Causeway International and Scout E.

Diversification Opportunities for Causeway International and Scout E

0.0

Correlation Coefficient

Causeway International  Scout E

Pay attention - limited upside

The 3 months correlation between Causeway and Scout is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Causeway International Value and Scout E Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scout E Plus and Causeway International 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 Causeway International Value are associated (or correlated) with Scout E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scout E Plus has no effect on the direction of Causeway International i.e., Causeway International and Scout E go up and down completely randomly.

Pair Corralation between Causeway International and Scout E

If you would invest  1,836  in Causeway International Value on December 22, 2024 and sell it today you would earn a total of  264.00  from holding Causeway International Value or generate 14.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Causeway International Value  vs.  Scout E Plus

Causeway International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Causeway International Value are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Causeway International showed solid returns over the last few months and may actually be approaching a breakup point.

Scout E Plus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Scout E Plus has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Scout E is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Causeway International and Scout E

The main advantage of trading using opposite Causeway International and Scout E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Causeway International position performs unexpectedly, Scout E 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 Scout E will offset losses from the drop in Scout E's long position.

The idea behind Causeway International Value and Scout E Plus 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.

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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.