Correlation Between Nasdaq and Scout Core

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

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

Diversification Opportunities for Nasdaq and Scout Core

0.0

Correlation Coefficient

Nasdaq  Scout Core

Pay attention - limited upside

The 3 months correlation between Nasdaq and Scout is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc 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 Nasdaq 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 Nasdaq Inc are associated (or correlated) with Scout Core. 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 Nasdaq i.e., Nasdaq and Scout Core go up and down completely randomly.

Pair Corralation between Nasdaq and Scout Core

If you would invest  7,283  in Nasdaq Inc on October 1, 2024 and sell it today you would earn a total of  559.00  from holding Nasdaq Inc or generate 7.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Nasdaq Inc  vs.  Scout E Plus

Nasdaq Inc

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Nasdaq may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Scout E Plus

Risk-Adjusted Performance

0 of 100

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 Core is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Nasdaq and Scout Core

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

The idea behind Nasdaq Inc 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.

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 Money Managers module to screen money managers from public funds and ETFs managed around the world.