Correlation Between SCANSOURCE (SC3SG) and Gelsenwasser

Can any of the company-specific risk be diversified away by investing in both SCANSOURCE (SC3SG) and Gelsenwasser 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 SCANSOURCE (SC3SG) and Gelsenwasser into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SCANSOURCE and Gelsenwasser AG, you can compare the effects of market volatilities on SCANSOURCE (SC3SG) and Gelsenwasser 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 SCANSOURCE (SC3SG) with a short position of Gelsenwasser. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANSOURCE (SC3SG) and Gelsenwasser.

Diversification Opportunities for SCANSOURCE (SC3SG) and Gelsenwasser

0.0

Correlation Coefficient

SCANSOURCE (SC3SG)  Gelsenwasser

Pay attention - limited upside

The 3 months correlation between SCANSOURCE and Gelsenwasser is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SCANSOURCE and Gelsenwasser AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gelsenwasser AG and SCANSOURCE (SC3SG) 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 SCANSOURCE are associated (or correlated) with Gelsenwasser. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gelsenwasser AG has no effect on the direction of SCANSOURCE (SC3SG) i.e., SCANSOURCE (SC3SG) and Gelsenwasser go up and down completely randomly.

Pair Corralation between SCANSOURCE (SC3SG) and Gelsenwasser

Assuming the 90 days trading horizon SCANSOURCE is expected to generate 0.75 times more return on investment than Gelsenwasser. However, SCANSOURCE is 1.33 times less risky than Gelsenwasser. It trades about 0.05 of its potential returns per unit of risk. Gelsenwasser AG is currently generating about -0.02 per unit of risk. If you would invest  2,960  in SCANSOURCE on October 4, 2024 and sell it today you would earn a total of  1,560  from holding SCANSOURCE or generate 52.7% return on investment over 90 days.

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

SCANSOURCE  vs.  Gelsenwasser AG

SCANSOURCE (SC3SG)

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SCANSOURCE are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, SCANSOURCE (SC3SG) may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Gelsenwasser AG

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gelsenwasser AG are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Gelsenwasser may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with SCANSOURCE (SC3SG) and Gelsenwasser

The main advantage of trading using opposite SCANSOURCE (SC3SG) and Gelsenwasser positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCANSOURCE (SC3SG) position performs unexpectedly, Gelsenwasser 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 Gelsenwasser will offset losses from the drop in Gelsenwasser's long position.

The idea behind SCANSOURCE and Gelsenwasser AG 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.