Correlation Between Intermediate Capital and Science In

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

By analyzing existing cross correlation between Intermediate Capital Group and Science in Sport, you can compare the effects of market volatilities on Intermediate Capital and Science In 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 Intermediate Capital with a short position of Science In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intermediate Capital and Science In.

Diversification Opportunities for Intermediate Capital and Science In

0.12

Correlation Coefficient

Intermediate Capital  Science In

Average diversification

The 3 months correlation between Intermediate and Science is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Intermediate Capital Group and Science in Sport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Science in Sport and Intermediate Capital 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 Intermediate Capital Group are associated (or correlated) with Science In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Science in Sport has no effect on the direction of Intermediate Capital i.e., Intermediate Capital and Science In go up and down completely randomly.

Pair Corralation between Intermediate Capital and Science In

Assuming the 90 days trading horizon Intermediate Capital is expected to generate 6.93 times less return on investment than Science In. In addition to that, Intermediate Capital is 1.34 times more volatile than Science in Sport. It trades about 0.01 of its total potential returns per unit of risk. Science in Sport is currently generating about 0.1 per unit of volatility. If you would invest  2,600  in Science in Sport on December 26, 2024 and sell it today you would earn a total of  250.00  from holding Science in Sport or generate 9.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Intermediate Capital Group  vs.  Science in Sport

Intermediate Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Intermediate Capital Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Intermediate Capital is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Science in Sport

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Science in Sport are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Science In may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Intermediate Capital and Science In

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

The idea behind Intermediate Capital Group and Science in Sport 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.