Correlation Between Aperture Health and ScanSource

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

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

Diversification Opportunities for Aperture Health and ScanSource

0.0

Correlation Coefficient

Aperture Health  ScanSource

Pay attention - limited upside

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

Pair Corralation between Aperture Health and ScanSource

If you would invest  4,905  in ScanSource on October 26, 2024 and sell it today you would earn a total of  189.00  from holding ScanSource or generate 3.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	90.48%
Values	Daily Returns

Aperture Health  vs.  ScanSource

Aperture Health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aperture Health has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Aperture Health is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

ScanSource

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ScanSource are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, ScanSource exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aperture Health and ScanSource

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

The idea behind Aperture Health and ScanSource 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.