Correlation Between Janus Overseas and SCOR PK

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

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

Diversification Opportunities for Janus Overseas and SCOR PK

0.82

Correlation Coefficient

Janus Overseas  SCOR PK

Very poor diversification

The 3 months correlation between Janus and SCOR is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Janus Overseas Fund and SCOR PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOR PK and Janus Overseas 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 Janus Overseas Fund 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 Janus Overseas i.e., Janus Overseas and SCOR PK go up and down completely randomly.

Pair Corralation between Janus Overseas and SCOR PK

Assuming the 90 days horizon Janus Overseas is expected to generate 3.21 times less return on investment than SCOR PK. But when comparing it to its historical volatility, Janus Overseas Fund is 3.49 times less risky than SCOR PK. It trades about 0.14 of its potential returns per unit of risk. SCOR PK is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  244.00  in SCOR PK on December 25, 2024 and sell it today you would earn a total of  59.00  from holding SCOR PK or generate 24.18% return on investment over 90 days.

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

Janus Overseas Fund  vs.  SCOR PK

Janus Overseas

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Janus Overseas Fund are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Janus Overseas may actually be approaching a critical reversion point that can send shares even higher in April 2025.

SCOR PK

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SCOR PK are ranked lower than 10 (%) 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 Janus Overseas and SCOR PK

The main advantage of trading using opposite Janus Overseas and SCOR PK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Janus Overseas 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 Janus Overseas Fund 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.