Correlation Between Intal High and SCOR PK

Can any of the company-specific risk be diversified away by investing in both Intal High and SCOR PK 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 Intal High and SCOR PK into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intal High Relative and SCOR PK, you can compare the effects of market volatilities on Intal High and SCOR PK 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 Intal High with a short position of SCOR PK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intal High and SCOR PK.

Diversification Opportunities for Intal High and SCOR PK

0.65

Correlation Coefficient

Intal High  SCOR PK

Poor diversification

The 3 months correlation between Intal and SCOR is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Intal High Relative and SCOR PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOR PK and Intal High 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 Intal High Relative are associated (or correlated) with SCOR PK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCOR PK has no effect on the direction of Intal High i.e., Intal High and SCOR PK go up and down completely randomly.

Pair Corralation between Intal High and SCOR PK

Assuming the 90 days horizon Intal High is expected to generate 3.2 times less return on investment than SCOR PK. But when comparing it to its historical volatility, Intal High Relative is 4.03 times less risky than SCOR PK. It trades about 0.01 of its potential returns per unit of risk. SCOR PK is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  294.00  in SCOR PK on December 2, 2024 and sell it today you would lose (19.00) from holding SCOR PK or give up 6.46% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.19%
Values	Daily Returns

Intal High Relative  vs.  SCOR PK

Intal High Relative

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Intal High Relative are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Intal High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

SCOR PK

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in SCOR PK are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, SCOR PK showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intal High and SCOR PK

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

The idea behind Intal High Relative and SCOR PK 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 Global Correlations module to find global opportunities by holding instruments from different markets.