Correlation Between Scout E and Causeway International

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

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

Diversification Opportunities for Scout E and Causeway International

0.0

Correlation Coefficient

Scout E  Causeway International

Pay attention - limited upside

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

Pair Corralation between Scout E and Causeway International

If you would invest (100.00) in Scout E Plus on October 8, 2024 and sell it today you would earn a total of  100.00  from holding Scout E Plus or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Scout E Plus  vs.  Causeway International Value

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

Causeway International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Causeway International Value has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Scout E and Causeway International

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

The idea behind Scout E Plus and Causeway International Value 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.